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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 01-12-2018, 05:13 AM
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LittleScholars LittleScholars is offline
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Default Tax catergories

Since opening I've used two different CPAs, and each use slightly different categories (some overlap, of course, but others do not). Do you all lump activities/toys/supplies under materials and supplies, or do you break these out?

Are there any other categories your CPA adds that are useful for daycare? For example, last year our CPA added "small furniture" because I was purchasing lots of smaller pieces for our new space.
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Old 01-12-2018, 01:52 PM
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Default expense categories

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Originally Posted by LittleScholars View Post
Since opening I've used two different CPAs, and each use slightly different categories (some overlap, of course, but others do not). Do you all lump activities/toys/supplies under materials and supplies, or do you break these out?

Are there any other categories your CPA adds that are useful for daycare? For example, last year our CPA added "small furniture" because I was purchasing lots of smaller pieces for our new space.
There is no rule about what category you can put an expense in. See my article:http://tomcopelandblog.com/go-list-expense-categories
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Old 01-16-2018, 06:05 AM
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Thank you! I suppose an even better question may have been, does it raise flags to have a high supplies/material total vs. breaking expenses out further? I use quickbooks and dump most things in this category, but I'm wondering if that is wise in future years.

Thank you!

Jamie
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Old 01-16-2018, 09:32 AM
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TomCopeland TomCopeland is online now
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Default expense categories

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Originally Posted by LittleScholars View Post
Thank you! I suppose an even better question may have been, does it raise flags to have a high supplies/material total vs. breaking expenses out further? I use quickbooks and dump most things in this category, but I'm wondering if that is wise in future years.

Thank you!

Jamie
One way you can get audited is if a high percentage of your expenses are lumped together. For example, if your income was $40,000 and your supply expenses were $2,000, not a big deal. But if your supply expenses were $12,000 that might attract more attention from the IRS. So, don't put a large percentage of your expenses under Supplies or any other single category.
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