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4. If you report $500 of income but no expenses, the extra tax is going to be about $60-$120, and you wont owe any penalties for not paying in advance. It will probably just reduce your normal refund. 5. If you dont report it, the IRS will probably not find out, since less than 1% of taxpayers are audited. But reporting it is the right thing ...

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The SE tax is already included in your tax due or reduced your refund. It is on the 1040 Schedule 2 line 4 which goes to 1040 line 15. The SE tax is in addition to your regular income tax on the net profit. You do get to take off the 50% ER portion of the SE tax as an adjustment on 1040 Schedule 1 line 14 which flows to 1040 line 8a.

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