George,
I would advise against this as there are other more important considerations.
Your company’s chart of accounts design should be driven primarily by your desire to record financial information that supports sound decision making. The reporting requirements of your company, including tax reporting, are secondary considerations. Companies will typically design chart of accounts to capture information to support management decisions, regulatory reporting, loan covenants, etc. The key consideration should always be the support for sound management decisions.
While Schedule C reporting is important, it should never be the driver and, it is more advisable to combine account groups to align with IRS forms, including Schedule C.
Pro
- Simple
- Supports tax filing
Con
- Might not report/present information is a form that supports effective management
- Might not support other reporting requirements
- Business form might change
Best of luck!
