How to Determine Business Activity Code for Schedule C

You must file Schedule C with Form 1040.
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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.

Step 1

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.

Step 2

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."

Step 3

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."

Step 4

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

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