To create a Schedule C in Software, from the Federal Section of the tax return, select:
- Income
- Profit or Loss from Business - For a return filing MFJ, indicate if the business is for the taxpayer or the spouse. (Indicating the business is a Qualified Joint Venture is done in the Questions menu.)
- Enter the business name if it has one.
- Enter the business's EIN if it has one.
- Enter the business's address if it's different than the address on the tax return.
- Enter the 6-digit business activity code. This is required.
- Enter a maximum 20-character description of what the business does, then click Continue.
- Questions About the Operation of Your Business - Complete as needed.
- Income - Enter the income as needed. Use the blue squares if you wish to itemize any category for more clarity as to the different sources of income.
- Cost of Goods Sold - Complete as needed if the business has inventory for sale.
- General Expenses - Complete as needed. If an expense doesn't fit any category, that expense will be entered under Other Expenses.
- Car and Truck Expenses - If using standard mileage to compute vehicle expenses, enter the vehicle descriptions and mileages here.
- Depreciation - Enter assets being depreciated in this menu. For vehicles, their actual operating costs are entered here too.
- Other Expenses - Enter any expense here that doesn't fit any other menu category.
- Qualified Business Income Deduction - The program will calculate QBI, but it can be adjusted here if needed (this is uncommon). Also, enter under this menu the W-2 wages paid and the unadjusted basis of the depreciable assets. Indicate also if this is a specified service trade or business (SSTB).
- Expenses for Business Use of Your Home - If the business qualifies, select this menu to complete Form 8829. (Note that Form 8829 cannot cause the Schedule C to result in a loss but can only reduce net profit to zero.)