How to Determine Business Activity Code for Schedule C

You must file Schedule C with Form 1040.

You must file Schedule C with Form 1040.

If you're a member of an LLC, a sole proprietor or an independent contractor, you must file Schedule C with your federal income tax return. You use Schedule C to report your earnings, expenses and other information about your business to the Internal Revenue Service. On Schedule C, you're required to identify your business by selecting the correct six-digit business code. According to the IRS, the codes are based on the North American Industry Classification System.

Find the business activity codes on the instructions for Schedule C. For the 2011 tax year, codes were listed on page C-9 of the instructions.

Enter a description of your business on line A of Schedule C. Give the general activity or field and the service or product type. For example, a personal trainer might use "provided physical fitness services to clients."

Enter the code for your business on line B of Schedule C. Use the code list to find the correct code for your business. General business fields are marked in bold headings, with sub-headings and specific job categories listed underneath. Locate your general business heading and your job category to find your code. For example, the code for a child day care worker would use code 624410 for "Child day care services," found under the sub-heading of "Social Assistance," which in turn is under "Health Care & Social Assistance."

Enter "999999" as the code if you can't find your business. Code 999999 is the code the IRS uses for unclassified establishments.

Tips

  • You can file Schedule C-EZ if your business meets the requirements set by the IRS, as found on the Schedule C-EZ form.
  • You must file Schedule SE for self-employment tax on net earnings over $399 if you're required to file a Schedule C.

Warning

  • You must identify your customer on line A of Schedule C if you work in wholesale or retail trade or are connected with production services, such as manufacturing, mining and construction.

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