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June 6, 2019
Question

Tax Year Prior to 2020: If my wife does home based sales do I have to file as if she owns a business?

  • June 6, 2019
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June 6, 2019

Yes, if she is not an employee who receives a W-2.  You will file a Schedule C for the business.  The Schedule C will flow onto your individual income tax return (Form 1040) and be netted with other personal income and expenses.

You will enter the total off all of the gross income received from her customers, in addition to anything reported on the 1099-MISC. 

How to get to that area  While inside the software and working on your return, type Schedule C in the Search at the top of the screen (you may see a magnifying glass there).  There will be a popup that says Jump to Schedule C.  Select that to get to the general area. 

When you set up your business, you can use her own name, address, and social security number (if you don't have a business name or EIN). Then, when done with the Business Profile:

  • go to Business Income and Expenses
  • select Edit next to your business (if it is there)
  • scroll to Business Income 
  • on the next screen, you will see a place to enter a Form 1099-MISC (if she didn’t receive one, you can Skip past that)
  • then, on the next screen, you will see General Income (for income received that is not on a 1099-MISC form)
  • enter a description for the income (ex. Services, or Consulting, Customer Sales) and the amount

Follow through all the areas in the Business section of the TurboTax software and it will provide you with a lot of assistance. You'll notice blue links that have more information and details about the particular sections that will be extremely helpful. 

Also, this link may be helpful to you IRS Small Business Help Center .

 

What is a Schedule C?

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