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February 8, 2024
Question

Schedule C Cost of Goods Sold Question

  • February 8, 2024
  • 1 reply
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Good day, this may sound similar to a question I asked last week, but I added more information. 
This is in regards with my SMLLC and the “Does your business have inventory or cost of goods sold?” Last year, I went with this method, but I want to make sure I am doing it correctly. For the 2022 tax year, I sold photography calendars. Under Cost of Goods Sold Line 36 I stated I spent $1000 to purchase the calendars and had an inventory cost of $40 line 39 at the end of the year, which I did not sell until 2023. Now I am doing taxes for the 2023 tax year, I spent another $1400 on calendars $1100 my cost, of which I sold in 2023, and $300 my cost of calendars in 2024. I ended up making around $6,000 total selling the calenars.
So when doing my 2023 Taxes: Should I put $40 Line 35, $1100 Line 36, and $300 Line 41?
Second question – I purchased shipping packages/cardboard to mail the calendars, but did not keep inventory, I just used all of the supplies as I old the calendars – should I put that on line 38 under Costs of Good Sold, combine it with like 36, or put that expense somewhere else on my schedule C?
Thank you!

1 reply

February 8, 2024

You did everything correctly. The beginning inventory goes on line 35, purchases during the year on line 36, supplies on line 38 and ending inventory on line 41.

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