Tax Filing for Small Business Owners

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Do you own a small business? Do you work for yourself or hire others? Shop owners, Internet SEO consultants, dog walkers, massage therapists, and independent tutors are just some people who fill out special forms for their tax returns. You may need to fill out Schedule C, Form 2106, 1099-MISC, and/or Form 8829.

Schedule C

A Schedule C tax form is for a one-owner business. It’s used to report income and loss. There’s also a shorter form called a Schedule C-EZ. Like the 1040-EZ, it’s used for simple reports. A simple report for a business means no employees or net losses and an income of less than $5,000.

If you’re not sure which Schedule C form to fill, use tax preparation software. H&R Block Premium is designed for small businesses. You can start the filing process for free. Live advice is included at no additional cost.


A 1099-MISC is a tax form sent to consultants, freelancers, and similar professions from their employers. You should receive this form at the beginning of each year if someone has paid out $600 or more to you. If you’re certain a client paid $600 or more but failed to receive a 1099-MISC, notify him. The next step is to contact the IRS, who’ll send a special form to fill out in its place. Your employer will likely be penalized for not sending it, if it didn’t simply get lost in the mail.

Form 8829

This is a form used to deduct expenses you incurred by using your home as a place of business. It can be used by daycare owners or anyone else who operates from their home. The space claimed must be used exclusively for business. If you regularly use the space to browse the Internet or watch television, it can’t be claimed as a home office.

Form 8829 is where things get complicated. You’ll need to download and print the form from the IRS website, then enter the square feet of your home office and entire home. In some cases, it’s also necessary to state how many hours out of the day the place of business is in use. Some of the 40 lines don’t apply to everyone, though.

To make Form 8829 easier, use tax preparation software like H&R Block. This way, the software skips over unnecessary lines and calculates whether or not a home office deduction is even applicable to you.

Form 2106

This form is used to deduct auto expenses. The cost per mile varies each year, but in 2019 the IRS allowed citizens to deduct 51 cents until June 30th, then 55 ½ cents thereafter. Only claim miles that were used specifically for business. Keep strict track of your records in case of an audit.

E-filing Your Taxes

Using software to file your taxes online is generally the easiest method. Software like H&R Block at Home Premium only asks questions that are applicable. You save time by skipping over irrelevant sections. In addition, it’s guaranteed accurate or any fines are paid by H&R, not you.