2 Sch C's or one?

[joanmcq]

Client worked for an auto shop and was paid by 1099. Knew it was wrong, but needed the job. Originally she was willing to go the SS-9 route, but has rethought it since her girlfriend still works for the shop. Client started her own auto repair biz after quitting the shop.

So, one Sch C or two? Her biz has a lot of expenses, but little income. Pay from the job-on-1099 is about 25k.

[AZ-Tax]

Possibly similar situation

Client worked for an auto shop and was paid by 1099. Knew it was wrong, but needed the job. Originally she was willing to go the SS-9 route, but has rethought it since her girlfriend still works for the shop. Client started her own auto repair biz after quitting the shop.

So, one Sch C or two? Her biz has a lot of expenses, but little income. Pay from the job-on-1099 is about 25k.

Your client work as a IC with the auto shop then in the same tax year your client started it's own Auto shop. I had a situation where a client worked as an IC for a Hair Salon then started her own Hair Salon mid year. She filed a Sch C under her IC relation using her SS# then I filed another Sch C using her Salon's EIN.

[taxmesoftly]

2 Sch C's

I would file 2 schedule c's and separate the expenses accordingly.

[Bill Tubbs]

Concur

I would file 2 schedule c's and separate the expenses accordingly.

I concur with that. Just wanted to point out though that whether you separate them into 2 C's, or combine them into 1 C, the end result would be the same (taxable income, self-employment tax, etc.). So, I don't think it's great shakes either way, but I personally would do 2.

[Gary2]

I don't see the purpose or value of doing two. It just seems like extra work. If the client bought depreciable tools for the first job, and kept them for the second, do you really want to deal with separating out the depreciation?

[Bill Tubbs]

Tools

I don't see the purpose or value of doing two. It just seems like extra work. If the client bought depreciable tools for the first job, and kept them for the second, do you really want to deal with separating out the depreciation?

Yeah, I thought of that after my post. Or, business use of home, or... One purpose of separating them would be to determine how profitable each one is so the client can see how each endeavor performed. But I agree that separating them _may_ be more trouble than it's worth. Either way, no difference in overall tax impact.