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Daycare and Taxes>Cell Phone - Use For Pics And Calling
WImom 01:51 PM 02-04-2014
I wanted to make sure I have this right. We can still deduct either the phone (landline) or the cell phone if we use both for personal and business. One would be the 1st phone (can't deduct) and one would be the
2nd line (we can deduct).

I use my land line for mostly daycare calls and cell for personal so I thought I should deduct my land line but I do take many pics of the kids on my cell to use for my website. So would I need to deduct the cell? If so we have a family plan (3 phones) so I would just split it between 3 and then t/s?
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Heidi 02:20 PM 02-04-2014
I am planning on deducting part of both. My house phone is actually 99% daycare, because it's the number listed with the state for my license and NO ONE calls it, ever, except telemarketers and potential clients. That bill is "bundled" with the internet and TV, so I am using my T/S percentage for it.

I use my cellphone for sending pictures, texting and calling parents, and updating my FB page of children doing adorable things. I can't remember how I deducted that last year. I will have to look.

The worst thing that could happen is I get audited, and they ask me to justify it. If they aren't satisfied with my justification, they would remove one of the expenses, I suppose.
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TomCopeland 03:38 PM 02-04-2014
Originally Posted by Heidi:
I am planning on deducting part of both. My house phone is actually 99% daycare, because it's the number listed with the state for my license and NO ONE calls it, ever, except telemarketers and potential clients. That bill is "bundled" with the internet and TV, so I am using my T/S percentage for it.

I use my cellphone for sending pictures, texting and calling parents, and updating my FB page of children doing adorable things. I can't remember how I deducted that last year. I will have to look.

The worst thing that could happen is I get audited, and they ask me to justify it. If they aren't satisfied with my justification, they would remove one of the expenses, I suppose.
You can never deduct the cost of the first phone line into your home, no matter how much you use it for your business. You can deduct the time-space % or an actual use % of the second line. You can choose which line is which.
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TomCopeland 03:40 PM 02-04-2014
Originally Posted by WImom:
I wanted to make sure I have this right. We can still deduct either the phone (landline) or the cell phone if we use both for personal and business. One would be the 1st phone (can't deduct) and one would be the
2nd line (we can deduct).

I use my land line for mostly daycare calls and cell for personal so I thought I should deduct my land line but I do take many pics of the kids on my cell to use for my website. So would I need to deduct the cell? If so we have a family plan (3 phones) so I would just split it between 3 and then t/s?
You should pick which phone line you want to consider as the first line into your home. You can't deduct any portion of the first line. You can deduct the second line based on your time-space % or an actual business use %. In your case, count the land line as your second line. Split the cost of the family plan into three parts and deduct the time-space % or actual use percent on one of the parts.
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Heidi 04:06 PM 02-04-2014
Originally Posted by TomCopeland:
You can never deduct the cost of the first phone line into your home, no matter how much you use it for your business. You can deduct the time-space % or an actual use % of the second line. You can choose which line is which.
hmmmm...that's interesting.

What about the internet and cable? I use the internet for my webpage, to email clients, for my food program, for my facebook page, for classes and trainings, etc. We don't get a separate bill for our bundle. A phone line alone is about $15 per month, I think, but the whole thing is over $150.

Some states REQUIRE a land line for licensing. How on earth can that not be deductible? Not saying it is, or that it's your decision...I get that you're the messenger here.
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TomCopeland 10:44 AM 02-05-2014
Originally Posted by Heidi:
hmmmm...that's interesting.

What about the internet and cable? I use the internet for my webpage, to email clients, for my food program, for my facebook page, for classes and trainings, etc. We don't get a separate bill for our bundle. A phone line alone is about $15 per month, I think, but the whole thing is over $150.

Some states REQUIRE a land line for licensing. How on earth can that not be deductible? Not saying it is, or that it's your decision...I get that you're the messenger here.
You can deduct the time-space % of your internet and cable (assuming you use cable in your business). If you have a bundle of cable, internet and phone, divide by 3 and claim the time-space % of internet and cable.

Over 25 year ago all home based businesses could deduct a portion of the first phone line into their home. Congress changed the law to help reduce the deficit. We had a provider in Minnesota who didn't have a phone and only got one because she was required to by law. I wrote a letter to the IRS asking if she could deduct the phone, but they said no. So, that's the law.
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Heidi 11:46 AM 02-05-2014
Originally Posted by TomCopeland:
You can deduct the time-space % of your internet and cable (assuming you use cable in your business). If you have a bundle of cable, internet and phone, divide by 3 and claim the time-space % of internet and cable.

Over 25 year ago all home based businesses could deduct a portion of the first phone line into their home. Congress changed the law to help reduce the deficit. We had a provider in Minnesota who didn't have a phone and only got one because she was required to by law. I wrote a letter to the IRS asking if she could deduct the phone, but they said no. So, that's the law.
ok. thank you, Tom!

I remember you from 25 years ago...lol. It's when I first started in this business, and you were presenting at a conference I attended. I was definitely using old info, then.

If I could get some sort of documentation as to what portion of the bill is the phone (which is by far the smallest portion), can I then just use the T/S for the rest?

As far as cable, there is a TV in the playroom, and my one non-morning napper usually gets to watch a little TV while the others sleep, and once in a while when we have rainy days, it's on for them. That's what's in my policy manual, as well.
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TomCopeland 02:19 PM 02-05-2014
Originally Posted by Heidi:
ok. thank you, Tom!

I remember you from 25 years ago...lol. It's when I first started in this business, and you were presenting at a conference I attended. I was definitely using old info, then.

If I could get some sort of documentation as to what portion of the bill is the phone (which is by far the smallest portion), can I then just use the T/S for the rest?

As far as cable, there is a TV in the playroom, and my one non-morning napper usually gets to watch a little TV while the others sleep, and once in a while when we have rainy days, it's on for them. That's what's in my policy manual, as well.
Unless you can get your cable company to tell you how much each portion of the bill is for the phone, divide the bill into 3 (phone, cable, internet) and take the time-space % of the cable and internet.
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