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Self employed
Hi momosgirl,
I understand your concerns since there are more self reporting elements in a Schedule C, Profit or Loss From Business. Recommend the following:
(1) Top Five Ways to Avoid a Tax Audit
(2) Report all business income and business expenses in its entirety with supporting documents in case of IRS inquiry.
(3) Review Schedule C expenses categories for proper classification, i.e. do not have a very large Misc. expenses without description.
https://www.irs.gov/pub/irs-pdf/f1040sc.pdf
https://www.irs.gov/pub/irs-pdf/i1040sc.pdf
(4) TurboTax Audit Meter at end of Schedule C is helpful.
(5)
When the IRS Classifies Your Business as a Hobby
If your business claims a net loss for too many years, or fails to meet other requirements, the IRS may classify it as a hobby. Running a hobby as a business could very possibly trigger an IRS audit.
Hope the above helps. Thank you.
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