Sales commissions you pay belongs on Line 10, commissions and fees.
Why line 10
Commission paid to an independent sales rep or to an affiliate who drove a sale is a selling cost, and it goes on line 10. The deciding question is employment status: a commissioned employee's pay is wages on line 26 with payroll tax and a W-2, while an independent rep's commission is line 10 with a possible 1099-NEC. Affiliate payouts work the same way no matter how the percentage is calculated or which network pays it out.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so sales commissions you pay lands on Line 10 without you sorting it.
Start for freeWhat sales commissions you pay is confused with
- Line 26, wages
- If you control how, when and where the person sells, they are an employee and the commission is wages on line 26.
- Line 11, contract labor
- Pay for producing the work is contract labor on line 11; pay for sourcing or closing the sale is a commission on line 10.
- Line 8, advertising
- An ad network that happens to price on a cost-per-sale basis is still buying you traffic, so it is advertising on line 8.
Examples that belong on line 10
- A 2,400 dollar affiliate payout on 24,000 dollars of tracked sales at 10 percent
- 15 percent to an independent manufacturer's rep on a wholesale order
- Monthly payouts through an affiliate network such as ShareASale or Impact
- A 1,000 dollar bonus to an outside rep for hitting a quarterly number
- 5 percent of collected revenue paid to a commission-only sales contractor
What does not belong here
- Commission to an employee salesperson, which is wages on line 26
- Your own draw or owner pay, which is never a deductible expense
- The affiliate network's own platform or subscription fee, which is line 27a
- Unpaid commissions accrued at year end, if you are on the cash method
The limit that applies
Independent reps and affiliates paid 2,000 dollars or more in 2026 or later need a Form 1099-NEC; the threshold was 600 dollars for years before 2026.
What to keep
Keep the commission schedule or affiliate agreement, the per-period payout report, and a W-9 for every payee. Tie the yearly payout total to line 10 and to any information returns you filed.
Other expenses on line 10
| Expense | Line |
|---|---|
| a real estate commission split | Schedule C, Line 10 |
| Amazon seller fees | Schedule C, Line 10 |
| App Store and Google Play commission | Schedule C, Line 10 |
| Etsy fees | Schedule C, Line 10 |
| pay-per-lead fees from Thumbtack, Angi or Yelp | Schedule C, Line 10 |
| PayPal fees | Schedule C, Line 10 |
| referral fees you pay | Schedule C, Line 10 |
| Shopify transaction fees | Schedule C, Line 10 |
| Square fees | Schedule C, Line 10 |
| Stripe processing fees | Schedule C, Line 10 |
| Upwork and Fiverr platform fees | Schedule C, Line 10 |
Related lookups
- Can I pay my child and deduct it on Schedule C?
- Where do subcontractors go on Schedule C?
- Where does Google Ads spend 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.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so sales commissions you pay lands on Line 10 without you sorting it.
Start for free