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What is Schedule C and who files it?

Updated By ProfitDrawer

Short answer

Schedule C (Form 1040), Profit or Loss From Business, is the form sole proprietors use to report income and expenses from a business carried on for income or profit. Owners of single-member LLCs file it too, unless the LLC elected to be treated as a corporation. For the 2026 tax year, it is filed with Form 1040 by April 15, 2027. A ProfitDrawer bookkeeping spreadsheet keeps the yearly income and expense totals Schedule C asks for.

Who files Schedule C (Instructions for Schedule C, 2025):

  • Sole proprietors and independent contractors whose main purpose is income or profit and who work with continuity and regularity. A sporadic activity, a not-for-profit activity or a hobby does not qualify.
  • Owners of single-member LLCs that have not elected corporate treatment.
  • Statutory employees, certain qualified joint ventures, and people reporting business amounts shown on Forms 1099-NEC, 1099-MISC or 1099-K.
  • Anyone with more than one sole proprietorship files a separate Schedule C for each business (IRS Publication 334, 2025).

What it covers: gross receipts (line 1, including amounts on any Forms 1099-NEC), returns, cost of goods sold, business expenses, business use of your home, and the net profit or loss on line 31.

Where the result goes: the net profit or loss is carried to Schedule 1 (Form 1040), line 3, and to Schedule SE, where self-employment tax applies if net earnings are $400 or more.

General information, not tax advice.

Source: IRS Instructions for Schedule C (Form 1040) (2025) · Updated

Tools and spreadsheets for this

Self-employed tax set-aside calculatorHow much of your profit to set aside for taxes.

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General information, not tax, legal or financial advice. Check the rules for your state and your situation.