What is Line 31 on Schedule C?
Line 31 — Net profit or (loss)
Line 31 on Schedule C is your net profit or loss: Line 7 gross income minus Line 28 total expenses, adjusted for Line 30. This is the number that matters most. A profit flows to Schedule 1 (Form 1040), Line 3, and from there into your adjusted gross income — and if it is $400 or more, it also goes to Schedule SE to calculate self-employment tax. A loss generally reduces your other income, subject to a few limitation rules.
Examples
- $59,500 gross income minus $12,000 of documented expenses leaves a $47,500 net profit.
- A first-year business with more startup costs than income shows a loss on Line 31.
- A profitable side business adds its Line 31 profit to the wages on your Form 1040.
Watch out for
- Self-employment tax is roughly 15.3% on top of income tax — profit on Line 31 is what drives it.
- Every legitimate receipt you captured during the year directly reduces this line.
- Recurring losses year after year can trigger hobby-loss scrutiny, so documentation matters.
Full checklist for your trade
Stop guessing the category
DocuSpending reads each receipt and assigns the Schedule C category for you, then totals the year on demand.
General information, not tax advice. Amounts, limits, and percentages change between tax years — check the current IRS Schedule C instructions or ask a tax professional about your situation.
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