Oil & Gas Schedule C subject to SE by someone who is passive investor

USA Discussion in 'Individuals' started by khaynes1971, Dec 7, 2018.

  1. khaynes1971

    khaynes1971

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    I have a return I filed which included some Oil & Gas interest. Reported the Royalties on Sch E. Reported the working interest on Sch C - NOT SUBJECT to SE Tax. The spouse is the one who received the 1099-MISC with Box 2 and Box 7. I do not think she should be subject to SE tax since she has nothing to do with the operations and lives in a different state.
    Received a notice stating the income may be subject to SE tax and I am to respond why she should not be subject to SE tax. Do I have a case to avoid SE tax?
     
    khaynes1971, Dec 7, 2018
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