You cannot deduct the products you buy for personal use. You can
only deduct the products you actually sell to others or use as samples.
You will enter the
total off all of your gross income received from your
customers, in addition to anything reported on the 1099-MISC. Then, your
Cost of Goods sold will reflect the actual price you paid for the items.
If you only received
commission directly from
the company, and didn't take money from clients personally (for example, if
they purchased only on a website), then you can only report that income.
You will file a
Schedule C for the business. The Schedule C will flow onto your individual income tax return
(Form 1040) and be netted with other personal income and expenses.
The result for
your Gross Receipts on line 1 of your Schedule C for your
business should be every dollar you actually received, including all your sales
taxes. Then, deduct your Cost of Goods Sold, sales taxes paid, other
expenses, etc. on the following screens where the software indicates to put
them.
How to get to that
area
:
While inside the software and working on
your return, type Schedule C in the Search at the top of the
screen (you may see a magnifying glass there). There will be a popup that
says Jump to Schedule C. Select that to get to the general
area.
- Business Income and Expenses
- select Edit next to your business (if
it is there)
- scroll to Business Expenses
Follow through all the areas in the Business section of the
TurboTax software and it will provide you with a lot of assistance. You'll
notice blue links that have more information and details about the particular
sections that will be extremely helpful.
