Message Font: Serif | Sans-Serif
No. of Recommendations: 0

Gracie writes, "In order to earn a little extra money I do surf the
Web and click for pennies on the Internet... I was wondering if I
should report that on Schedule C, so I could write off the expense of
the Internet?"

In this situation, Gracie is considered a sole proprietor and has
self-employment income. We'll cover the basics of filing as a sole
proprietor in the next two tips.

You are a sole proprietor if you are the sole owner of a business that
is not a corporation or partnership. Report your income and expenses
from your sole proprietorship on Schedule C Form 1040, Profit or Loss
From Business, or on Schedule C-EZ Form 1040, Net Profit From

You may use Schedule C-EZ to determine your net profit if you have
only one sole proprietorship and you meet all the requirements listed
in Part 1 of Schedule C-EZ. If you can use Schedule C-EZ, gross
receipts from your business and total expenses are reported in Part
II. The difference between gross receipts and total expenses you
reported is your net profit. Report Net profit on line 12 of your Form

You cannot use Schedule C-EZ if your business expenses were more than
$2,500, your business used the accrual method of accounting, you
deducted expenses for the business use of your home, or if you had
employees, a net loss, or inventory.

If you cannot use Schedule C-EZ, you must report your business income
and expenses on Schedule C. And, if you have more than one sole
proprietorship business, or if you and your spouse have separate
businesses, you must use a separate Schedule C for each business.

Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.