Where do I put my business expenses for inventory I purchased?

Inventory is part of Cost of  Goods Sold (COGS).    If your business' annual gross receipts for the last three tax years average out to $26 million or less per year, you can opt to use the cash method and expense the cost of inventory at the time it was purchased, rather than waiting until after it's been sold.

In TurboTax, you can report these costs in the inventory section as COGS or in the expenses section as supplies.   Either way, you don't have to report inventory but you do need to carefully track what you paid for the products, materials, and supplies that go into your inventory.    Choose your version below to see your options for reporting inventory costs in TurboTax.

Reporting inventory costs in TurboTax Online

Reporting inventory costs in TurboTax Home & Business

For more info on Cost of Goods Sold and Inventory, see Pub 535 - IRS - Cost of Good Sold