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during the years in issue represent self-employment income within
the meaning of section 1402. For the following reasons we hold
that they do.
Section 1401 imposes a tax "on the self-employment income of
every individual". Self-employment income is defined in section
1402 to mean "the net earnings from self-employment derived by an
individual * * * during any taxable year". Sec. 1402(b).
Section 1402(a) defines "net earnings from self-employment" to
mean "the gross income derived by an individual from any trade or
business carried on by such individual, less the deductions
allowed by this subtitle which are attributable to such trade or
business".
In Newberry v. Commissioner, 76 T.C. 441, 444 (1981), this
Court held that, for income to be taxable as self-employment
income, "there must be a nexus between the income received and a
trade or business that is, or was, actually carried on." Under
the Court's interpretation of the "nexus" standard, "any income
must arise from some actual (whether present, past, or future)
income-producing activity of the taxpayer before such income
becomes subject to * * * self-employment taxes". Id. at 446.
Section 1.1402(a)-1(c), Income Tax Regs., provides that, where
the required nexus exists, payments may be subject to self-
employment tax even when they are attributable in whole or in
part to services rendered in a prior taxable year. See also
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