Schedule C for mobile food catering business

[adP37064]

Please let me know if I have to report business income on Schedule C and let me know if I should report business income (online payments) under General Income.

I am Sole Proprietor of a mobile food catering business (business code 722300) that I am trying to grow with sales under $20K for the calendar year 2021, but with over 200 transactions using Square POS (point of sale). According to Square, I did not qualify to receive tax form 1099K since I processed less than the qualifying amount. So, I am not sure if I should report business income under General Income without tax form1099K.

Please also let me know if I have to report Cost of Goods Sold (cost associated with what I am selling). According to Turbo Tax (Home and Business edition), this type of business does not require an amount for COGS. I am confused if I should enter an amount for COGS.

Lastly, I travel around purchasing food items/meals for new ideas to add to my menu. Please let me know where in Schedule C to report this amount and if I can report 100% amount of this food research.

[RobertB4444 · Accepted solution]

Yes, you will report your income and expenses on schedule C.  If you do not report COGS then you pay tax on 100% of the money that you earned even though a lot of it was spent on supplies and a mobile restaurant.

You can deduct the expenses related to researching food for your restaurant.  Mileage on your vehicle, the cost of purchased food items, etc. are all deductible.

[adP37064]

To be clear, should I report business income (online payments) under General Income without tax form1099K? I appreciate the prompt response.

[DaveF1006 · Accepted solution]

Yes, you will report it as general income.

@adP37064