Self-Employment Income Different types of income can be SE income. The source of yourincome and your involvement in the activity from which your income isderived will determine whether it is SE income. Gains and losses.A gain or loss from the disposition of property that is neitherstock in trade nor held primarily for sale to customers is not SEincome. It does not matter whether the disposition is a sale,exchange, or an involuntary conversion. For example, gains or lossesfrom the disposition of the following types of property are not SEincome. Investment property. Depreciable property or other fixed assets used in yourtrade or business. Livestock held for draft, dairy, breeding, or sportingpurposes and not held primarily for sale, regardless of how long thelivestock were held or whether they were raised or purchased. Standing crops sold with land held more than oneyear. Timber, coal, or iron ore held for more than one year, if aneconomic interest was retained, such as a right to receive coalroyalties. A gain or loss from the cutting of timber is not SE income ifthe cutting is treated as a sale or exchange. For more information onelecting to treat the cutting of timber as a sale or exchange, seeTimber in chapter 2 of Publication 544. Dividends.hotel rooms CanicoDividends on securities you own are not SE income unless you are adealer in securities who is not holding the securities for speculationor investment. Interest.Interest you receive is not SE income unless you receive it in yourtrade or business. For example, interest received on notes or accountsreceivable that you accepted in the ordinary course of your businessis SE income. Likewise, interest received on loans is SE income if youare in the business of making loans. SE income does not includeinterest on bonds, notes, or other debt issued with interest couponsor in registered form by a corporation or governmental entity, unlessyou are a dealer in stocks or securities. But the interest is not SEincome if the stocks or securities are held for speculation orinvestment. Lost income payments.If you are self-employed and reduce or stop your businessactivities, any payment you receive from insurance or other sourcesfor the lost business income is SE income. If you are not working whenyou receive the payment, it still relates to your business (eventhough your business is temporarily inactive) and is SE income. If there is a connection between any payment you receive and yourtrade or business, the payment is SE income. A connection exists if itis clear that the payment would not have been made but for yourconduct of the trade or business. Part-time business.Income from a part-time business is SE income. For example, you fixtelevisions and radios in your spare time. You have your own shop,equipment, and tools. You get your customers from advertising andword-of-mouth. The income you earn from your repair shop is SE income. Real estate rent.Rent from real estate and personal property leased with real estateis not SE income unless either of the following applies to you. You are a real estate dealer. You provide services for your tenants. Real estate dealers.You are a real estate dealer if you are engaged in the business ofselling real estate to customers with the purpose of making profitsfrom those sales. Rent you receive from real estate held for sale tocustomers is SE income. However, rent you receive from real estateheld for speculation or investment is not SE income. Trailer park owners.If you are a trailer park owner who provides trailer lots andfacilities, the rent you receive is SE income if you providesubstantial services for the convenience of your tenants. Yougenerally are considered to provide substantial services for tenantsif they are primarily for the tenants' convenience and are notnormally provided to maintain the lots in a condition for occupancy.Examples of services that are for the tenants' convenience includesupervising and maintaining a recreational hall provided by the park,distributing a monthly newsletter to tenants, operating a laundryfacility, and helping tenants buy or sell their trailers. Examples ofservices that are normally provided to maintain the lots in acondition for tenant occupancy include city sewerage, electricalconnections, and roadways. Services are substantial if thecompensation for the services makes up a material part of the tenants'rental payments. Hotels, boarding houses, and apartments.Rents received for the use or occupancy of hotels, boarding houses,or apartment houses are SE income if services are provided for theoccupants. Services generally are provided for the occupants if theyare primarily for their convenience and not services normally providedwith the rental of rooms for occupancy only. Maid service, forexample, is a service provided for the convenience of the occupants.However, heat and light, the cleaning of stairways and lobbies, andthe collection of trash are not services primarily for the occupants'convenience. Research grants.Hoteles economicos en BoracayIf you receive payments under a research grant and perform servicesfor the grantor as an independent contractor, the payments you receiveare SE income. baccarat regelsFor more information about whether you are an independentcontractor, see Independent contractor, earlier. U.S. possession self-employment income.SE income from activities in a U.S. possession is subject to SEtax, even if your U.S. possession income is exempt from U.S. incometax. The following are treated as U.S. possessions. Guam American Samoa The Virgin Islands The Commonwealth of the Northern Mariana Islands Puerto Rico Form to file.If you must file Form 1040, report all of your SE income onSchedule SE. This is true even if your possession income is nototherwise reported on Form 1040. If you do not have to file Form 1040,use Form 1040-SS to report your SE income. If you are a resident ofPuerto Rico, you can file Form 1040-PR instead of Form1040-SS. More information.For more information on U.S. citizens in U.S. possessions, seePublication 570, Tax Guide for Individuals With Income From U.S.Possessions. Wages, salaries, and tips.Wages and salaries received for services performed as an employeeand covered by social security or railroad retirement are not SEincome. Tips received for similar services as an employee are not SEincome. Corporate Payments Whether income received from a corporation is SE income depends onthe reason for the payment. Corporate director.Fees received for performing services as a director of acorporation are SE income. It does not matter whether the fees are forgoing to directors' meetings or for serving on committees. Corporate employee.Even if you own most or all of the stock of a corporation, yourincome as an employee or officer of the corporation is not SE income. S corporations.If you are a shareholder in an S corporation, your share of thecorporation's taxable income is not SE income, even though you includeit in your gross income for income tax purposes. If you are a shareholder and also an officer of an S corporationand perform substantial services, you are an employee of the Scorporation. Your payment for services is subject to withholding forsocial security and Medicare taxes and is not SE income, regardless ofwhat the S corporation calls the payments.