If you work for an entity as a non-employee and earn more than $600 in income, you receive an Internal Revenue Service Form 1099-MISC typically by the end of January of the following year. The IRS receives the same information from the entity for which you worked. You report this "miscellaneous" income on Schedule C, Profit or Loss from Business, when you file your yearly income tax return.
Gather your 1099-MISC forms. If you consulted for more than one concern, you will have more than one form. Be sure all are included.Step 2
Sum up any business income that was not reported on a 1099-MISC. Whether you did not receive a 1099-MISC because you did not earn at least $600 or because the company you worked for failed to meet its IRS reporting requirements, you must report any and all business income on Schedule C.Step 3
Add together the 1099-MISC and non-reported business income and enter it on Line 1b of Schedule C.Step 4
Fill out the rest of Schedule C to include any applicable expenses. Deduct the expenses from the income to discover whether you operated at a profit or a loss. Include Schedule C when you file Form 1040.
- If you are self-employed, you may also need to file Schedule SE, which calculates self-employment tax.
- If you operated a home business, you may also need to file Form 8829 to report related expenses.
- business lifeguard image by Keith Frith from Fotolia.com