 Income tax 2021-2022, business income or loss and other gains or losses. Get ready to get refunds to the max. Dive in to income tax 2021-2022. Income tax formula focused in on the income line. First page of the form 1040. We're looking at line number eight. Other income from schedule one line 10. Here is schedule one focused on line number three. Business income or loss. Attach schedule C. The sum of the schedule one port one. Then summing up and going into page one of the form 1040. Line number eight. So we're focused here on the business income or loss. You can see it says attach schedule C. The schedule C is generally going to be a sole proprietor type of business. We're going to dive into a lot more details with the sole proprietor type of business in a future presentation. And if you're in the field of tax preparation, just note that you might want to try to specialize and think about what type of tax returns are you focused on doing and are you focused on like more basic returns that you're going to do a lot of them or you're going to be focusing in on more complex returns, possibly charging more, putting more time into them as they will require more time and doing fewer returns. When you're thinking about more complex returns, then you want to think about the types of things that will create a return to be more complex. Obviously the dollar amount in terms of the income level could make it more complex, whether or not they itemize or not, could make a return more or less complex. And then business kind of relationships in terms of different business entities, like a schedule C or other flow through entities, a schedule S or an LLC limited liability company could add to complexity if you're taking on that business side. And those business kind of transactions will also lead clients to often needing some kind of bookkeeping help too. So you're going to be picking up like bookkeeping type of stuff as well. So all that kind of stuff could be a little bit more complex when you're looking at the schedule C for the sole proprietorship, then you're picking up a business side of things and that's going to touch into possibly some of these other areas. There will be other impacts on the tax return as well, which we'll take a look at in future presentations. But you could have things like self-employment tax. You got to think about estimated tax payments in that case because you don't have the W-2 withholdings that are going to be in place. You've got the expenses, whether or not the expenses are going to be deductible or not with regards to business related expenses. You've got specific credits related to a business as well. And then you've got other kind of like retirement plans and so on that could be going through a business. It adds a level of complexity and it also leads people to possibly needing more tax planning as opposed to simply just tax preparation. So just keep those in mind. We'll dive into some more of that in future presentations for now. Just note that the schedule C in total is basically another form that's going to feed into the first page of the 1040 on that income line which you can imagine here or you can imagine on the 1040 here on line eight and then pulling in from the schedule one. You realize that it's a little bit deceiving to call this an income line that's pulling in from the schedule C because if you imagine what's happening on the schedule C if we go to the schedule C we're going to have an income statement in essence, income minus expenses, expenses being those items that are deductible, expenses for a business being those items that you used in order to generate revenue in the business. So that means that the net income, the net taxable income in essence is what's going to be pulling into the first line item of your income tax equation. But that net component has already been included or netted out a bunch of deductions that are on the schedule C. So you got to keep that kind of straight in your mind. The schedule C will have deductions on it. It's going to be the revenue minus the expenses in essence. The net amount is what's going to be pulling into our first page of our tax equation here. So once again we'll talk about that more in future presentations. We also have business income or loss. If you operate in a business or practice your profession as a sole proprietor, that's when you typically report the schedule C, report your income and expenses on the schedule C that then flows through to the schedule one and then to the first page of the 1040. Other gains or losses. If you sold or exchanged assets used in a trade or business you could see instructions for form 4797. So this is another kind of business related item where we might have sold assets and have to report that in another form which is going to be form 4797. So we might take a quick look at that here but again we'll dive more into the business information for sole proprietorship in future presentations.