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Level 3
posted Dec 28, 2023 12:05:07 PM

Sole proprietor

1. As a sole proprietor, can I NOT deposit cash received for services but still report that same cash as income? Use the cash for personal expenses. 
2. therefore, then would it be alright if my cash bank deposits DON’T  match my income?

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1 Best answer
Level 15
Dec 29, 2023 12:30:06 PM

Yes.   You don't take an owner's draw or expense withdrawals.  All the business income and expenses are your personal income and expenses in the first place. You just fill out a Schedule C. The net profit or loss is your income.  

3 Replies
Level 15
Dec 28, 2023 12:46:38 PM

That's ok.  It is still income.   You might want to use Quicken or QuickBooks to keep tract of your income and expenses.  You can pay bills any way you want, from cash, from checking, from credit card, etc.  

Level 3
Dec 29, 2023 12:24:33 PM

This is a question. It went in the wrong spot I think

 

So to be clear, as a sole proprietor,—— instead of depositing cash into the business account and then taking an owners draw, I can just keep it to use for personal expenses as long as it’s still recorded as income on my schedule C.?

Level 15
Dec 29, 2023 12:30:06 PM

Yes.   You don't take an owner's draw or expense withdrawals.  All the business income and expenses are your personal income and expenses in the first place. You just fill out a Schedule C. The net profit or loss is your income.