Tax Line Assignment

As far as I know, there is no such thing as owners "equity" for a Sole Proprietorship. The net profit from the business flows to your personal 1040 on Line 12.

-- Vic Roberts Replace xxx with vdr in e-mail address.

Vic, Thanks for the reply. I am not a tax whiz, but since I contributed cash equity to the business when I started it I don't think I have to show an "equity withdraw" as a profit and post to line 12. Perhaps someone can shed some additional light on this subject. Thx, Bill

I agree that you should not have to list what you contributed. However, I think that the concept of "contributing" was wrong from the start. A sole proprietorship is not a separate financial entity. I'm not sure how you could have contributed to start with. It always was your money.

I used to be a sole proprietor but switched to a C Corp three years ago so may have forgotten some of the rules for the SP. You may want to ask over in misc.taxes.moderated. Just be aware that the moderator has been dealing with some health issues and posting time for questions and responses is at least one-day each.

-- Vic Roberts Replace xxx with vdr in e-mail address.

There is no balance sheet for a schedule C. Therefore it does not get assigned.