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

Income — Business; Form 1040, Line 12

Completing Schedule C

Part I: Income

Enter on line 1 the amount for gross receipts from the taxpayer's trade or business. Include amounts received in the trade or business that were properly shown on Forms 1099-MISC.

Caution

Be sure you probe to find out if the taxpayer received business income that was not reported on Form 1099-MISC. For example, tips received by self-employed hair stylists or manicurists are to be included in gross receipts on Schedule C-EZ/C.

Statutory Employees

If the taxpayer received Form W-2 and the "Statutory employee" box 13 was checked, report the income and expenses related to that income on Schedule C or C-EZ. Enter the statutory employee income from Form W-2, box 1, on line 1 of Schedule C or C-EZ. Social security and Medicare taxes should have been withheld from the earnings; therefore, the taxpayer does not owe self-employment tax on these earnings. Statutory employees include full-time life insurance agents, certain agent or commission drivers, traveling salespersons, and certain home workers. See Schedule C Instructions for more information.

Self-employment income and statutory employee income cannot be reported on the same Schedule C. The taxpayer must file two separate Schedules C.

Schedule C, Part 1 Income.
Schedule C

Schedule C