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What is generally accepted requirement for cash receipts for Sch C? I help people with daily chores such as child care, piano teach, yard work, general handyman, house sitting and cleaning, etc... It averages around $1000/mo, Do I need to keep record every cash received? I don't plan to claim any expenses, only report income in cash. If audited, will no record of cash received prevent me from filing Sch C ?
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Do I need to keep record every cash received?
Yes you do ... buy a cheap receipt book at the office supply store and use it all the time. Also depositing cash in a bank account is a good way to track it and prove you actually got the money.
I don't plan to claim any expenses, only report income in cash. You must report all qualified expenses on the Sch C.
If audited, will no record of cash received prevent me from filing Sch C ?
If audited the IRS may allow your income but will deny any credits it produces especially the Earned Income Credit. Fastest way to get audited is to have a Sch C with income only and a profit that puts you at the highest point of the EIC chart. They are really clamping down hard on "convenient" Sch Cs that are filed just to get the EIC & refundable CTC.
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