| As another alternative, or if you're thinking twice | | | | Sounds bit complicated? Not at all. It's simple math |
| about leasing or renting a space, you can run your | | | | that you can use to gain maximum tax benefits |
| very own home day care center. If you're such a | | | | for your business. |
| great babysitter that your friends and relatives | | | | You can also deduct food and consumables. |
| have taken to regularly leaving their kids with you, | | | | Keeping your receipts-and knowing what items to |
| why not start your own home day care center? | | | | declare can help you save on expenses. You can |
| Not only will you be doing something you love, but | | | | declare anything that you use-consumables like |
| you'll be making a lot of money on the side too. | | | | toilet paper, laundry soap, and your microfiber |
| Home day care centers enjoy lots of tax | | | | diapers, even something as basic as table napkins. |
| deductions and here's a small guide that you can | | | | As long as you use them for your day care |
| use to see how you can benefit for home day | | | | business, you're set. Simply multiply your |
| care tax deductions if you meet the IRS | | | | expenses against the formula above to get a final |
| requirements. | | | | number. |
| The requirements are the following, basically. | | | | You can also get tax deductions on supplies and |
| You must be a day care center taking care of | | | | utilities. Having children around is bound to |
| clients. | | | | consume more water and electricity. All the |
| You must have a license and meet all of your | | | | services you use for your day care can be |
| state requirements. Once your license has expired | | | | declared. Just multiply the total amount you spend |
| or is revoked, so are your nifty tax bennies. | | | | in a year by our trusty formula above. If you |
| Once your business is on its feet (or even during | | | | have a separate line installed for your day care |
| the times that you're just setting it up) using your | | | | business (for example, a secondary phone line |
| home as a day care has its own list of benefits. | | | | only used for your day care needs), you can |
| Here are some tax deductions that you may | | | | actually get as much as a 100% deduction. This |
| have not known about: | | | | applies to any of all services installed exclusively |
| Deduct your home space vs. business space. | | | | for your day care business. |
| What? This may sound like a lot of math but it's | | | | Finally, you can declare work done on home |
| actually easy. Whatever portion of your home | | | | services. Any renovation or remodeling done for |
| you use for day care can be declared for tax | | | | the business can be declared as a tax deduction. |
| deductions, just follow this simple formula: | | | | Save all of your receipts for basic things like |
| Total sq. footage of your home you use for your | | | | plumbing or house repair. One of your clients |
| daycare = % used for daycare | | | | destroyed your wallpaper? You can declare it and |
| Total sq. footage of your home | | | | use it to float your expenses. You can also |
| If you operate your day care center from 9 am | | | | declare other services like cleaning. |
| to 5 pm, follow this formula to determine how | | | | This is one of the great advantages of running a |
| much of your daily hours rate as business hours. | | | | day care center from your home space. It gives |
| Total hrs used for day care = number of hours | | | | you a much needed buffer from taxes. |
| you use run your business | | | | Knowledge is power or in this case, knowledge is |
| 8760 hrs (8764 on leap years) | | | | money. Spending a little time calculating during tax |
| Finally: | | | | season can give you many happy returns and |
| Your total household income x % of footage | | | | relief from future problems. Just remember to |
| used for daycare x number of hours = amount | | | | save all those receipts! |
| you can declare as a tax deductions. | | | | |