Calculating Time Space When Taking Summers Off
Quick question on How to figure my time space % when only providing care during the school year and taking summers off.
I provide care in my home from mid Aug to May 31st. Daycare is closed from June 1st to around Aug 20th each year. I generally do not record working any hours in June of July. I usually start recording hours the week prior to going back to work in August as I am cleaning, meal planning, activity planning, organizing etc that week before. How should I be calculating my time %? Do I divide my hours worked by total hours available for 12 months or total hours available for9 1/2 months? It makes a significant difference in my time space %. |
I do the same and was told you count year round as businesses don't start and stop annually. You can't start and stop depreciation for the closed months etc. and I was unable to find tax law that said I could not include those summer months. I did find tax law staying you have to count days off in your total time so this is like an extended time off. I do count any time advertising, painting my daycare space, switching toys up, online trainings etc that I take while closed.
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summer off
Originally Posted by Kemp: |
Thank you both for the quick reply. I have not been using my utilities for the entire 12 months. I leave out the utility bills for June and July. Should these be included then?
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summer off
Originally Posted by Kemp: |
Originally Posted by TomCopeland: Is there tax law that speaks to allowing us to say we are only open 10 not 12? My tax person goes to lots of your trainings and is on your list of tax companies but is questioning the 10 month for time. He is wondering what tax laws apply to this. |
Sorry, I am not understanding this correctly. Right now our taxpreparer takes my hours for the 9.5 months I am providing care in my home and divides that number by the number of hours in a year (8760). My time space comes out to be around 26%. But when I divide that number by 7056 hrs which is the actual number of hours per yearly home is open for care ( 42 wks x 168 (hrs/wk) it comes out to 33%. 100% of my home is used for daycare. I am not understanding how using the hours for 12 months would give me a higher percentage?
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time-space%
Originally Posted by LittleExplorers: |
time-space%
Originally Posted by Kemp: |
Thank you so much Tom! I understand now. I misread the article you shared and thought I was obligated to count the full 12 months of hours.
Will share this with my preparer. This will definitely help me! |
Originally Posted by TomCopeland: Thanks, I will share this with him. Does counting only 12 months effect depreciation in any way? |
depreciation
Originally Posted by LittleExplorers: |
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