"how does the government see how much you make via your tax returns?"
The purpose of the tax return is to show much you made and to determine your taxable income (which can be different than "how much you made") and tax due. I guess I don't understand your question since the point of a tax return is to show the government how much you made.
Perhaps you are asking, how does the government know that you made this or that? This is why many tax forms are copied to the IRS, like W-2s from employers and 1099-MISCs from businesses paying contractors. The IRS gets the copies of these documents then matches them up with the tax return that you submit. If the IRS computer is not happy with the match, then a letter is generated which recalculates your tax based on the documents they got from other sources and asks you to pay or dispute it.
"I got a return of $200 " - Do you mean that you got a refund of $200? The "return" is the document (the 1040 and supporting schedules) that you file with the IRS.
"on my schedule C my income is 45k" and "On my 1040, it says my taxable income is 0." - this is highly unlikely so I don't even want to guess what you mean.
Note that we in the Community cannot see your tax return nor the screen you are on, so please restate your question(s) in more detail.
