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Level 4

Question

Schedule C line 23

Forum|Forum|4 years ago
April 2, 2022
6 replies
38 views

I'm giving 2 examples trying to understand

State and local sales taxes imposed on you as the seller of goods or services. If you collected this tax from the buyer, you also must include the amount collected in gross receipts or sales on line 1.

I just want to be sure and please help me with this on these 2 examples :

1) Painter charges (collects) sales tax for his service

2) Restaurant (Pizza or Deli ) charge ( collect ) sales taxes for their service (changing dough into pizza , making coffee etc.

So this would be true in both cases to include in line one and deduct on line 23

Level 14

Yes, sales tax can be deducted on Schedule C line 23. However, in your example, you have described two non-similar businesses, a painter and a restaurant. You can not combine the sales tax from the two businesses and claim it on one business. Each business should have a separate Schedule C to report income and expenses.

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DubosticaAuthor

Level 4

I Understand it must have 2 separate schedules.

I was asking as far as business in general :

Painter fits the description with his service sales tax charge ( collection) as well as Restaurant s ( Pizza, Deli)

So both would be able to deduct on line 23 for their services?

Level 14

Yes, both would be able to deduct the sales tax paid by the business on Schedule C Line 23

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