If you were deducting the cost of items only when they were sold, then you were calculating COGS correctly, even if you entered it as a miscellaneous expense instead of in Schedule C COGS section. The issue is more about reporting location than the deduction itself.
Going forward, you should use the proper COGS section (Part III of Schedule C) and track beginning and ending inventory. If inventory amounts have grown significantly, switching methods or formally correcting it may require additional steps, so consulting a tax professional for future years would be wise.
@avigo45
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
