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New Member
posted Apr 17, 2023 8:44:02 PM

Hello, I'm working on the Freelance section. I have parts that I bought and sold them directly to customers at cost. Do these go in the "Supplies Expenses" section?

I suspect these kinds of expenses don't go here, but maybe more for items that I don't re-sell?

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1 Best answer
Expert Alumni
Apr 17, 2023 8:59:06 PM

You can use the Supplies expense for those parts you re-sold.    If you are a small business taxpayer, you can choose not to keep an inventory.  You qualify as a small business taxpayer if you (a) have average annual gross receipts of $27 million or less for the 3 prior tax years, and (b) are not a tax shelter (as defined in section 448(d)(3)).   

1 Replies
Expert Alumni
Apr 17, 2023 8:59:06 PM

You can use the Supplies expense for those parts you re-sold.    If you are a small business taxpayer, you can choose not to keep an inventory.  You qualify as a small business taxpayer if you (a) have average annual gross receipts of $27 million or less for the 3 prior tax years, and (b) are not a tax shelter (as defined in section 448(d)(3)).