Report cash the same way as any other business income: include it in gross receipts on Schedule C, line 1. IRS Publication 334 (2025) says you must report all income you receive from your business, including income not reported to you on a Form 1099. If you receive more than $10,000 in cash in one transaction or related transactions, you must also file Form 8300. A ProfitDrawer bookkeeping spreadsheet logs each cash payment as income.
A simple routine for cash payments:
- Give a receipt or invoice for every cash payment, with the date, customer and amount.
- Enter it in your books the same day.
- Deposit the cash in your business account when you can, so bank records back up your books.
- At year end, total all income, cash or not, for Schedule C.
Rules to know:
- Under the cash method, you report income in the year you actually or constructively receive it (Schedule C instructions, 2025).
- For Form 8300, cash includes U.S. and foreign coins and currency and certain cashier's checks, traveler's checks and money orders, but not a personal check.
- Cash income counts toward self-employment tax, which applies when net earnings are $400 or more.
- Payments in property or services are income too, at their fair market value.
Keep receipts and deposit records; the IRS generally says to keep records for 3 years. General information, not tax advice.
Source: IRS Publication 334 (2025), Tax Guide for Small Business · Updated
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General information, not tax, legal or financial advice. Check the rules for your state and your situation.