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Daycare and Taxes All things related to Taxes and running a Daycare post here. Topics of tax exemptions, forms, filings, tax write offs, IRS etc.

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Old 03-27-2017, 09:24 PM
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Default Business Checking Account

Do you have to have a business account? How does it work when almost everything I buy is time/space deductions?
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Old 03-27-2017, 09:30 PM
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I have a business account that I use for 100% childcare purchases. All payments go into the business account, then are transferred to our family account. Time/Space items are purchased with the family account.

The more you can keep business and family separated (depositing into business account and 100% business purchases from business account) the better if you're audited.
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Old 03-28-2017, 11:38 AM
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Quote:
Originally Posted by sahm1225 View Post
Do you have to have a business account? How does it work when almost everything I buy is time/space deductions?
There is no right or wrong about having a separate business checking account. Most providers only use a personal checking account for business and personal purposes.

A separate business account can be useful to deposit all business income and write checks for 100% business items. But, since most of your expenses are business and personal, a separate account is not a perfect solution.

In an audit, the IRS will look at both your business and personal accounts.
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Old 03-28-2017, 05:46 PM
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Also, business accounts have higher monthly fees, so unless there is a good reason to keep business finances separate, it's just an unnecessary expense. I've had a few businesses in my life and only 2 had a separate account.
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Old 03-29-2017, 06:02 AM
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Quote:
Originally Posted by AmyKidsCo View Post
I have a business account that I use for 100% childcare purchases. All payments go into the business account, then are transferred to our family account. Time/Space items are purchased with the family account.

The more you can keep business and family separated (depositing into business account and 100% business purchases from business account) the better if you're audited.
I have payroll (for myself) directly taken out of my business account and direct deposited into my personal checking. ALL 100% daycare use items are purchased with my business checking. I don't have anything except for bills under T/S% really.

Quote:
Originally Posted by Mike View Post
Also, business accounts have higher monthly fees, so unless there is a good reason to keep business finances separate, it's just an unnecessary expense. I've had a few businesses in my life and only 2 had a separate account.
Get a better bank! My business account is free.
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Old 03-29-2017, 10:24 AM
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Quote:
Originally Posted by daycarediva View Post
I have payroll (for myself) directly taken out of my business account and direct deposited into my personal checking. ALL 100% daycare use items are purchased with my business checking. I don't have anything except for bills under T/S% really.



Get a better bank! My business account is free.
Mine is free at chase bank.
Daycare diva - di you issue yourself a. W2?
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Old 03-29-2017, 10:55 AM
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Quote:
Originally Posted by daycarediva View Post
I have payroll (for myself) directly taken out of my business account and direct deposited into my personal checking. ALL 100% daycare use items are purchased with my business checking. I don't have anything except for bills under T/S% really.



Get a better bank! My business account is free.
My business account used to be free then they started charging me $15 a month (at Chase).

I like having separate accounts because all of my daycare income goes into that and I can pay 100% business things straight out of that account so keeping track of expenses is easier for me.

My income goes into that account, I transfer 10% of the deposit to my business savings account, transfer what I need to my personal account, transfer another 10-15% to my IRA (all from my mobile app). Doing this helps me organize my finances better.
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