Printing consumables for a print on demand seller belongs on Part III line 38, part iii line 38, materials and supplies.
Why part iii line 38
If you print the items yourself, the blanks, ink, film, transfer paper and adhesive become the product the customer buys, so their cost is Part III materials and supplies and reaches the return through cost of goods sold rather than line 22. Line 22 says in terms that it is for supplies not included in Part III, and this is the case it is excluding. A small business taxpayer under the gross receipts test may treat inventory as non incidental materials and supplies and deduct it when the item is sold or used, which changes the timing but still reports it in Part III. A seller who holds nothing and only pays a fulfilment partner per order is paying for a finished good, which is a Part III purchase on line 36.
Log it once, with the line already on it. Type an expense in plain words in ClaryBook and it is filed with a date, vendor, amount and what it was for, so the number your preparer needs for printing consumables for a print on demand seller is already written down.
Start for freeWhat printing consumables for a print on demand seller is confused with
- Line 22, supplies
- Line 22 is for supplies consumed running the business that do not become a product, so a service business with no goods sold uses line 22 while a seller printing merchandise uses Part III.
- Part III line 36, part iii line 36, purchases less personal use
- Blanks and finished items you buy in ready to sell are purchases on Part III line 36, while the ink and film you consume turning them into the product are materials and supplies on line 38.
- Line 13, depreciation and section 179 expense deduction
- The printer, heat press and cutter last more than a year and are capital assets reaching line 13, not costs of goods.
Examples that belong on part iii line 38
- $640 for 200 blank Bella Canvas tees held as stock
- $280 of DTF ink and transfer film
- $95 of hot peel transfer paper
- $180 of sublimation blanks for mug orders
- $1,450 of stock and consumables counted into cost of goods sold for the year
What does not belong here
- Line 22, which excludes anything reported in Part III.
- The heat press and printer, which are capital assets.
- Platform and listing fees, which are commissions and fees on line 10.
- Shipping cartons used only to post the order, which are line 22.
The limit that applies
A small business taxpayer meeting the gross receipts test can treat inventory as non incidental materials and supplies, deductible when sold or used, instead of keeping full inventory accounting. The threshold is indexed and set each year.
What to keep
Keep the purchase invoices and a year end count of unsold stock, because cost of goods sold is a calculation from opening stock, purchases and closing stock. Without the counts the Part III figure cannot be supported.
Other expenses on part iii line 38
| Expense | Line |
|---|---|
| a baker's ingredients | Part III line 38 |
| raw materials | Part III line 38 |
Related lookups
- Where do job materials go on Schedule C?
- Where does inventory go on Schedule C?
- Where does capex go on Schedule C?
Sources
This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.
Looking for a different expense? The full Schedule C line lookup has every line from 8 to 27 with the expenses that belong on each, and Schedule C expense categories walks the whole form in order.
Log it once, with the line already on it. Type an expense in plain words in ClaryBook and it is filed with a date, vendor, amount and what it was for, so the number your preparer needs for printing consumables for a print on demand seller is already written down.
Start for free