Matthew breeds Cocker Spaniels for sale. Which schedule will he use to report his profit or loss?

Matthew, as someone who breeds Cocker Spaniels for sale, will use Schedule C to report his profit or loss. Schedule C is specifically designed for sole proprietors to report income or loss from a business they operate. This includes various types of businesses and activities, such as breeding and selling animals.

In this situation, since Matthew's activities can be classified as a business with the intent to make a profit through the sale of Cocker Spaniels, the appropriate form for him to file is Schedule C. This schedule allows him to report both his income from the sale of the dogs and any associated business expenses, such as feed, veterinary care, and other costs related to breeding.

Contrastingly, Schedule F is used primarily by farmers to report income from farming activities, which may not directly apply to Matthew if his operation is focused solely on breeding dogs without broader farming activities. Schedule E is generally used for income from rental property or partnerships, rather than for income generated directly from breeding and selling animals. Schedule D is used to report capital gains and losses from the sale of assets, which is unrelated to the typical reporting of business income from selling goods or services. Thus, the best fit for Matthew's situation is Schedule C.