My wife sells jewelry for Lia Sophia as a side business. She received a 1099-MISC for the amount of money she was paid over the last year.
This is the first year we have had to file her taxes for the business. I am filing them with my personal taxes and have a few questions. I entered the 1099-MISC into taxcut but it's now asking me questions about inventory valuation. She did receive statements throughout the year that show the amount she was paid.
We're only talking about $1400 in income. It's asking me whether I maintained records of cost of goods sold. I would imagine this is so I can claim expenses. It then wants to know what method I used to calculate the closing inventory value (cost, lower of cost, or other).
She purchased a kit with a base level of inventory and a few extra pieces throughout the year. Other than that, she only ordered items when they were purchased by customers. I have to account for that right?
Cost of Materials and Suppies..... this is where I claim mileage and ink for the printer right? (little stuff).
I apologize if this is the wrong forum for this question.
Thanks in advance, Doug