2018 Turbotax Home and Business, under Business Income & Expenses has the category, "Inventory/Cost of Goods Sold." It asks you if you have inventory to report, but there is a question you can click on--"What counts as inventory"--that pops open a window that says, "If you have less than $1,000,000 in sales or receipts for each of the last three years, you are not required to report inventory." I am a sole proprietor who has sales for just one year (so I think that one year is used instead of three) who had sales of way less than $1,000,000 this year. The Inventory/Cost of Goods Sold category says, "If you're not reporting inventory, but had material & supply expenses, enter them as supplies under expenses.
The only possible interpretation of this is that I can avoid doing an inventory, and just list my material & supply expenses as supplies under expenses. Which flies in the face of other responses to similar questions I've seen here and articles I've read by CPAs online. Is Turbotax correct?
