Question

What is a Schedule C Tax Form?

Answer

The Schedule C: Profit or Loss From Business (Sole Proprietorship) is used to report how much money you made or lost in a business you operated by yourself. The form reports how much of the income from your business is subject to tax or whether you have a loss for tax purposes.

Who Should File a Schedule C Tax Form?

schedule C 1040If you’re self-employed and set up your business as a sole proprietorship, you should file Schedule C with your Form 1040 to report the profit or loss for your business. An activity qualifies as a business activity if it is operated with the intent to make a profit and is operated regularly and continually. That means you don’t need to use a Schedule C to report income from a hobby.

Schedule C collects the following business information:

  • Name
  • Product or service activity
  • Employer Identification Number (EIN) if applicable
  • Address
  • Accounting method
  • Gross receipts or sales
  • Cost of goods sold
  • Business expenses

Do you still need help with your Schedule C Tax Form and how it affects your taxes? Check out our Guide to Gig Worker Taxes.


What Other Forms May Need to Be Completed Outside of a Schedule C? (Hint: Schedule SE)

Usually, people who file a Schedule C Tax Form will also have to file a Schedule SE Tax Form: Self-Employment Tax. You may also need Form 4562 to claim depreciation or Form 8829 to claim actual expenses from business use of your home.

More Help With Small Business Taxes And Filing IRS Schedule C

Business tax forms, like the IRS Schedule C, can get tricky when you are left to your own devices. Whether you make an appointment with one of our knowledgeable tax pros, you can count on H&R Block to help you out. You can also get small business-specific advice with H&R Block’s small business services.

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