Understanding IRS Schedule C: Profit or Loss from Business (Sole Proprietorship)

Schedule C is for reporting income and expenses from a sole proprietorship or single-member LLC.

Who Should File Schedule C?
  • Self-employed individuals (freelancers, consultants, gig workers)
  • Independent contractors (1099 recipients)
  • Single-owner businesses without corporate structure
What Can You Deduct?
  • Operating expenses: Supplies, advertising, insurance
  • Business use deductions: Home office, vehicle mileage
  • Inventory costs: Cost of goods sold calculations
  • Professional services: Legal, accounting fees
Essential Filing Tips
  • Maintain detailed records of all income and expenses
  • Use separate bank accounts for business transactions
  • Understand quarterly estimated tax requirements
  • Properly categorize business vs. personal expenses
Related Tax Forms
  • Form 1040 (Main individual tax return)
  • Schedule SE (Self-employment tax calculation)
  • Form 1040-ES (Estimated tax vouchers)
  • Form 8829 (Home office deduction)

Need Expert Schedule C Preparation?

KARME Tax Services helps sole proprietors:

  • Maximize legitimate business deductions
  • Properly document expenses for IRS compliance
  • Calculate accurate quarterly estimated payments
  • Optimize your business tax strategy

Call 972-519-0041 today or schedule online.

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