I did freelance programming work this year that came out to around $1,000 and I out that on my taxes. I also listed parts from a computer I built for this under “supplies” and listed each pa

[jbarr83]

I listed each part separately under “supplies” and already submitted my taxes when I read that this may not be correct. Is this acceptable?

[KrisD · Accepted solution]

Yes, it is acceptable but not necessary. It might technically be considered as inventory, if you purchased the parts, and then invoiced each part to your customer. Selling inventory could also cause you to charge state sales tax. The expense will affect the final income earned the same, you just want to use a procedure that makes sense to you, and be consistent over the years. 

If you are earning based on your service only, continue to cost out the parts as supplies, but there is no need to list each piece. Keep records with your business file and report the total amount for the year on your Schedule C. 

[jbarr83]

Okay great, thank you. I don’t sell the parts, just the coding services. First time doing this and I submitted as supplies. Next time I’ll just list it as “computer”