This article will show you how to start preparing Schedule C in TurboTax, using the Forms view instead of the Interview view. If you are new to TurboTax, you should use the interview format. But if you’ve used TurboTax in previous years, or have done your own Schedule C manually before, you should follow the instructions in the article to save time, since it’s usually faster to use Forms view instead of Interview view.
1. From the main menu, click on: View and then select Forms.
2. Click: Add or View form.
3. Add a form to your tax return. Click on the small plus sign (+) to the left of the 2008 Federal Form 1040 – Individual, which will display a list of all available forms. Click on: Schedule C: Business Profit or Loss. Then click: Add form.
4. Select Schedule C. If this is the first Schedule C you add to the return, Create a new copy is already selected. Now enter the type of business or profession from this Schedule C. For example, Tax Preparation or Real Estate Agent or Dog Catcher or whatever. Then click: Create.
5. The right hand side of your screen should now display Schedule C (Form 1040), Business Profit or Loss.
6. If you wish, you can adjust the size of the Exhibit C portion of your screen. Move the cursor to the left edge of the Schedule C portion and then move the crosshair to the left to increase the size of the Schedule C form.
7. At the top of this screen are 8 check boxes. Let’s go through each one to determine which ones you should check out:
#1: If this business was operated by your Spouse, check this box. So if you are the sole proprietor, please do not check the box. If your wife is the sole proprietor, you must check the box.
#2: If this business was jointly operated by the Taxpayer and Spouse, check this box. Generally, a business that is jointly owned and operated by a husband and wife is a partnership and must file Form 1065 instead of Schedule C. But there is a possible exception to that rule, known as a Qualified Joint Venture. See the TurboTax help screen for a detailed explanation of that situation.
#3: Check this box to file Schedule C even if you qualify to file Schedule C-EZ. Go ahead and check this box. You should get used to filing Schedule C, even if you qualify for the shorter Schedule C-EZ. Using Schedule C will force you to keep better records and have a better handle on what goes on in your business, especially regarding expenses.
#4: Check this box if you use your own name as a business name. If you do not have a separate business name, or “DBA” (Doing Business As), check this box.
#5: Check this box if you use your home address as your business address. If you do not have a separate business location, such as an office or store, that is, your only business address is your home address, check this box.
#6: Check this box if you completely disposed of this business in a fully taxable transaction during the year. If you didn’t sell your business, leave it alone. If you did, you should read the Help screen, and you may also need to obtain professional tax assistance to correctly report the sale of your business.
#7 and #8: These last two boxes only apply to clergy and members of religious orders. So if you’re not one of those, just ignore these boxes.