Internal Revenue Service United States Department of the Treasury
Level Basic Intermediate Advanced Military International

Income — Business; Form 1040, Line 12

Completing Schedule C-EZ

Part II: Figure Net Profit

Gross Receipts

NEW icon Line 1 now is 1a through 1d: Enter the amount as stated for each line.

  • 1a — Payments from Form 1099-K.
  • 1b — Gross receipts or sales not reported on Form 1099-K. This includes amounts paid to the business, whether or not it was reported on a Form 1099-MISC.
  • 1c — Income reported to the taxpayer on Form W-2 if the "Statutory Employee" box on that form is checked. (See Schedule C-EZ Instructions before completing this line.)
  • 1d — Total.

Part I, line 1a is for amounts from Form 1099-K, Merchant Card and Third Party Network Payments. For 2011, the IRS is delaying the requirement to put the Form 1099-K amounts on this line. The Instructions say enter a zero for 2011 on this line and include the amounts from Forms 1099-K in with other gross receipts on line 1b.

Tip

Examples of statutory employees include full-time life insurance salespeople, certain agent or commission drivers, traveling salespeople, and certain homeworkers. The Statutory Employee checkbox in box 13 of the taxpayer's Form W-2 should be checked.

Tip

Many taxpayers erroneously report amounts from Form 1099-MISC with wages or other income. This income should instead be reported on Schedule C or C-EZ and on Schedule SE. If the income is reported incorrectly, the IRS may later issue a notice of proposed tax increase for the self-employment income and tax.

Form 1099-MISC
Form W-2

Form 1099-MISC

Form W-2