Schedule C is the tax form that reports business income including side gigs, independent contractor work, and sole proprietorships.
The IRS used to have a separate Schedule C-EZ for smaller activities like side gigs. For IRS purposes, everything now goes on Schedule C.
For billing purposes, I still have different rates for Schedule C and Schedule C-EZ.
You qualify for the Schedule C-EZ rate if your business activity meets the old IRS rules for Schedule C-EZ:
- Under $5,000 in expenses
- Use the cash method of accounting
- No inventory, employees, or depreciation
- Not taking the home office deduction
- Don’t have a current year net loss
- Not carrying over a loss from a previous year