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-   -   Security Deposit Return (https://www.daycare.com/forum/showthread.php?t=94018)

Reimel61 01-20-2021 05:41 AM

Security Deposit Return
 
Hi

How do I address a refunded security deposit tax wise? Normally I apply it to the last week of care but I abruptly ended care with this family due to Covid and wanting to remain small in size due to the pandamic. Due I count it as a business expense? and not worry that she has already claimed it in a previous year or do I deduct the amount from her year end payment statement and just count as less income for my business?

Thanks

284878 01-20-2021 07:15 AM

If the refund happens now then it has to happen this year not next. (Per Tom Copeland)

TomCopeland 01-21-2021 07:28 AM

Originally Posted by Reimel61:
Hi

How do I address a refunded security deposit tax wise? Normally I apply it to the last week of care but I abruptly ended care with this family due to Covid and wanting to remain small in size due to the pandamic. Due I count it as a business expense? and not worry that she has already claimed it in a previous year or do I deduct the amount from her year end payment statement and just count as less income for my business?

Thanks

A refunded security deposit is a business expense. Call it "parent refund" and put it under "other expenses" on Schedule C. Deduct this from the amount of her end of year receipt statement.

Reimel61 01-21-2021 10:02 AM

thank you


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