Which of the following would NOT qualify as self-employment income?

Study for the Liberty Tax School Test with flashcards and multiple choice questions. Each question includes hints and explanations to help you understand. Prepare effortlessly and excel in your exam!

Self-employment income is typically derived from activities where a person works for themselves rather than as an employee of another entity. The reason salary from a part-time job does not qualify as self-employment income is that it is compensation for work performed as an employee, which means that the employer controls the manner in which the work is done and withholds taxes accordingly.

In contrast, income from freelance graphic design projects, selling crafts online, and profits from a lawn care business all involve individuals operating their own businesses or working independently. These activities allow the individual to make decisions about how to conduct their work, take on clients, set prices, and ultimately keep the profits after expenses. Therefore, they constitute forms of self-employment income since they reflect the individual's entrepreneurial efforts rather than traditional employee earnings.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy