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Commissions and Fees (Line 10 of Schedule C)

Line 10 on Schedule C of the tax form relates to “Commissions and Fees,” which refers to payments you make to individuals or businesses for services they provide to your business.

Commissions and fees can include payments made to salespeople, agents, brokers, and other professionals who work on a commission basis or provide services for a fee. Examples of commissions and fees include payments made to real estate agents, insurance agents, affiliate marketers, and other sales professionals who receive a commission or fee for each sale or lead they generate for your business.

On Line 10, you are required to report the total amount of commissions and fees paid during the tax year. This includes payments made in cash, by check, or through a payment processor such as PayPal.

It’s important to note that commissions and fees paid to employees should not be reported on Line 10, but rather on Line 26 (“Wages”) of Schedule C. Additionally, you should only report the amount of commissions and fees paid during the tax year, regardless of when the services were provided or when the payments were made.

You should keep accurate records of your commissions and fees paid, including receipts, invoices, and other documentation, in case you are audited by the IRS. If you have any questions about how to report commissions and fees on your tax return, it’s a good idea to consult with a tax professional or accountant.