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i used to buy parts for repair of cellular phones for my company.

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i used to buy parts for repair of cellular phones for my company. Where would this categorize under on schedule c? is it repairs or parts? or cogs? thanks
Submitted: 4 years ago.
Category: Tax
Expert:  Dave CPA replied 4 years ago.



Welcome to Just Answer,


If your company is in the business of repairing cellular phones then it would be cogs (line 4) as this would be deemed materials for the production of income. If your company buys these parts in order to maintain their business use phones then it would be repairs (line 21).


I hope this helps.

Customer: replied 4 years ago.
we were a prepaid cell phone company and sold used cell phones. We bought parts to repair phones that were not working, fixed it and sold the phones. hence, which line would it be? thanks
Expert:  Dave CPA replied 4 years ago.

Sorry I had to step away. These items would be cost of good sold (line 4) since they are materials used for products sold. Part 3 of schedule c is for cost of goods sold. This item would go on line 38, which then flows through to line 4 of Part 1. Let me know if you need anything else.
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