Definition
The IRS form where sole proprietors and single-member LLC owners report business income and expenses alongside their personal return. Revenue minus deductible expenses produces net profit, which flows into total income and is the base for self-employment tax.
Why it matters
Schedule C is where freelance expenses actually save money: every legitimate deduction cuts both income tax and self-employment tax. Sloppy expense tracking all year means overpaying in April.
Example
A freelance designer bills $60,000 and logs $12,000 of expenses: software, a laptop, home office, mileage. Schedule C shows $48,000 of net profit, so tax is calculated on $48,000, not $60,000, saving thousands versus reporting the gross.
Put it into practice
Related terms
This definition is educational, not financial, legal, or tax advice. U.S. rules and limits change; verify time-sensitive details with official sources. See our disclaimer.