INSTRUCTIONS FOR SCH C : Profit or Loss From Business

Use Schedule C (Form 1040) to report income or loss from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business. To report income from a nonbusiness activity, see the instructions for Form 1040, line 21, or Form 1040NR, line 21.

Also use Schedule C to report (a) wages and expenses you had as a statutory employee, (b) income and deductions of certain qualified joint ventures, and (c) certainincome shown on Form 1099-MISC, Miscellaneous Income.

See the Instructions for Recipient

(back of Copy B of Form 1099-MISC) for the types of income to report on

Schedule C. Small businesses and statutory employees with business expenses of $5,000 or less may be able to file Schedule C-EZ instead of Schedule C. See Schedule C-EZ for details. You may be subject to state and local taxes and other requirements such as business licenses and fees. Check with your state and local governments for more information.