Schedule C is an IRS tax form called “Profit or Loss From Business” that you file with your personal tax return (Form 1040) to report your business income and expenses. It calculates your business profit or loss, which then flows into your personal income and self‑employment tax.

Who typically files a Schedule C

Schedule C is generally used when your business income is reported on your personal tax return.

Owners commonly file Schedule C when:

• The business is taxed as a sole proprietorship.
• The business is a single‑member LLC that has not elected to be taxed as a corporation.

Other business structures usually file different returns:

• Partnerships typically file Form 1065 and provide each owner with a Schedule K‑1.
• S corporations typically file Form 1120‑S.
• C corporations typically file Form 1120.

If you are not sure which return your business should file, a certified tax professional can help you determine whether Schedule C applies to you.

How Schedule C works with your taxes

When you file your annual personal return (Form 1040), Schedule C is attached as a supporting form.

At a high level:

• You list your gross business income and returns/allowances.
• You subtract business expenses (such as advertising, contract labor, rent, and other deductible costs) to calculate your net profit or loss.
• If applicable, you may also report cost of goods sold and certain vehicle expenses.

What Lili’s Schedule C includes

For eligible account plans, Lili generates a Schedule C using the income and expense activity that has been categorized in your account.

The Lili‑generated Schedule C includes:

• Your business owner information and business name, based on your profile.
• Total business income for the year, based on deposits and categorized income.
• Business expenses organized into IRS‑aligned categories, based on how your transactions are categorized in Lili.
• A calculated net profit or loss figure for the business.

If there are uncategorized transactions for the selected period, you will be prompted to categorize them so they can be included in the appropriate line on your Schedule C.

Who can generate a Schedule C with Lili

Lili Smart and Lili Premium account plans include access to the Schedule C generator and its equivalent for multiple business owners. If you received business deposits in the prior year and have one of these plans, you can request a Schedule C for that tax year directly in your Lili account.

How to create a Schedule C in the Lili Web App

To request or create your Schedule C in the Web App:

1. Go to the Main Menu at the top left of your dashboard.
2. Select Reports & Statements.
3. Choose Schedule C and select the relevant tax year.
4. Review the disclaimer and select GET STARTED.
5. If prompted, categorize any remaining uncategorized income or expenses for that year so they are included correctly.
6. Follow any additional on‑screen instructions to generate your Schedule C.

Once your Schedule C is generated, you can:

• Click on the desired year.
• Use the options at the top right of the preview to Print or Download PDF.

How to create a Schedule C in the Lili Mobile App

To request or create your Schedule C in the Mobile App:

1. Open the main menu and tap Reports.
2. Select Schedule C and choose the relevant year.
3. Read the disclaimer and tap GET STARTED if prompted.
4. Categorize any remaining uncategorized transactions for that year.

After the Schedule C is generated, you will see a preview image of the form. Use the options above the preview to Share the document through your device’s native sharing tools.

How to use your Lili Schedule C

Your Lili‑generated Schedule C is designed to give you and your tax professional a starting point built from your real transaction data.

You can:

• Download the PDF and provide it to your accountant or tax preparer.
• Use the figures on the form when preparing your own return with tax software, verifying that all income and expenses are complete and correctly categorized.

All amounts on your Schedule C are based on the information in your Lili account, including how you or your team have categorized transactions. You should always review the form carefully and consult a qualified tax professional before filing.

Here’s what a Lili‑generated Schedule C looks like
 

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