Learn How To Save Money When You File Taxes For Your In-Home Daycare

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Many people think that working as a daycare provider allows them to be paid without having to claim taxes each year. That is not the case at all. The parents of the children who you care for will claim the daycare costs when they file their taxes. If your name is listed and you have not filed taxes, you could get into trouble for tax evasion.

There are a lot of things that can be deducted when you file your taxes if you own an in-home daycare though. The following guide walks you through a few things that you can deduct when filing taxes to help cut down on the amount that you have to pay.

Anything Cleaning Supplies You Use to Clean the Daycare Space

When you have a daycare, you need to keep it as clean as you can at all times. It is important to use cleaning supplies that are nontoxic and perfume free to ensure that they are safe for use around children. When you purchase these products, keep a running total for how much you spend and the receipts so that you can submit copies of the to the IRS if needed.

Any Food You Purchase to Feed to the Children

If you provide food to the children while they are at your daycare, the costs can be deducted from your taxes. It is important to purchase the food that you use for the daycare separately from the food that you use for your household so that it is easy to track when it is time to file your taxes.

Some of Your Daily Living Costs Can be Deducted

When you have an in-home daycare, you are able to deduct a portion of your mortgage, electric, and water payments each month from your taxes. This is because a portion of those costs is going toward your business. A tax specialist will be able to help you determine how much of the costs can legally be deducted.

It is best to meet with a tax specialist on a regular basis to ensure that you are able to properly track everything that you want to deduct from your taxes each year. Changes occur in the tax system on a regular basis and the specialist will be able to keep up with the changes to ensure that you do not miss out on a deduction that you are entitled to. Contact a CPA, like Jeffrey Beebe CPA, for more help.