Daycare.com Forum
Daycare and Taxes>Is Deducting Expenses The Same As Claiming Other Deductions On Taxes?
legomom922 11:11 AM 01-23-2011
Every yr I go through the same thing..I save all kinds of reciepts and stuff(not DC as this is my 1st yr) and in the end I find out the standard deduction is always more for us, and then thats what we use, and then I think about all of my wasted time...I think the standard deduction for married people was something like $11,000 or some crazy number like that. Even buying a house didnt help us because the interest rate is so low!
NOW, with all of the DC expenses, does this work the same way? Am I still going to find out after all of this time & energy, that I probably will still come out better with the standard deduction and therefore all of this will be a waste? Or is it the type of thing where it will act more of like a credit or something? I remember last yr we had new windows put in, and we were able to lower our tax because of the energy/home improvement tax credit we got.
So I am just wondering if all my efforts will be wasted...Could someone explain?
NOW, with all of the DC expenses, does this work the same way? Am I still going to find out after all of this time & energy, that I probably will still come out better with the standard deduction and therefore all of this will be a waste? Or is it the type of thing where it will act more of like a credit or something? I remember last yr we had new windows put in, and we were able to lower our tax because of the energy/home improvement tax credit we got.
So I am just wondering if all my efforts will be wasted...Could someone explain?
kendallina 01:46 PM 01-23-2011
You can take the standard deduction AND can deduct your daycare expenses, it's not just one or the other.
Abigail 04:00 PM 01-23-2011
I just realized today that it's not one or the other. LOL. I seriously thought it was over the years and I did take a tax class and must have missed that chapter! Every year I donate and don't keep receipts because I figured I would never reached the standard deduction amount. This year I donated (today, valued over $200!) and will keep my receipt and pictures and excel page that added it up for me and keep all our future receipts from monetary donations so we can deduct it all. I sure how we can do both (standard, plus specific items donated) because I'm all excited for next year.
kendallina 04:44 PM 01-23-2011
Originally Posted by Abigail:
I just realized today that it's not one or the other. LOL. I seriously thought it was over the years and I did take a tax class and must have missed that chapter! Every year I donate and don't keep receipts because I figured I would never reached the standard deduction amount. This year I donated (today, valued over $200!) and will keep my receipt and pictures and excel page that added it up for me and keep all our future receipts from monetary donations so we can deduct it all. I sure how we can do both (standard, plus specific items donated) because I'm all excited for next year.
I just looked up the charitable donations thing because I have some I'd be able to claim this year and I realized that you can deduct on your federal taxes only if you itemize, but I think you can deduct it on your state taxes...do you know if that's right?I just realized today that it's not one or the other. LOL. I seriously thought it was over the years and I did take a tax class and must have missed that chapter! Every year I donate and don't keep receipts because I figured I would never reached the standard deduction amount. This year I donated (today, valued over $200!) and will keep my receipt and pictures and excel page that added it up for me and keep all our future receipts from monetary donations so we can deduct it all. I sure how we can do both (standard, plus specific items donated) because I'm all excited for next year.
TomCopeland 08:03 PM 01-23-2011
If you were better off in previous years taking the standard deduction before you started doing child care, this will be even more true now that you are in business. When claiming property tax and mortgage interest you must divide these expenses between Form 8829 (time-space % amount) and Schedule A (the personal portion of these expenses). Since you will deduct less mortgage interest and property tax on Schedule A it will be more unlikely you will have enough expenses to itemize.
You can't deduct charitable deductions on your federal tax return unless you itemize on Schedule A.
You can't deduct charitable deductions on your federal tax return unless you itemize on Schedule A.
legomom922 11:34 AM 01-24-2011
Originally Posted by TomCopeland:
If you were better off in previous years taking the standard deduction before you started doing child care, this will be even more true now that you are in business. When claiming property tax and mortgage interest you must divide these expenses between Form 8829 (time-space % amount) and Schedule A (the personal portion of these expenses). Since you will deduct less mortgage interest and property tax on Schedule A it will be more unlikely you will have enough expenses to itemize.
You can't deduct charitable deductions on your federal tax return unless you itemize on Schedule A.
I am a real dummy when it comes to taxes Tom, so please forgive me, so are you saying being in business will NOT help me at all anyway if I take the standard dedcution? There is NO WAY I would ever have more than $11,000 in deductions........ Should I stop wasting my time and just forget trying to go through all these reciepts and folders then?If you were better off in previous years taking the standard deduction before you started doing child care, this will be even more true now that you are in business. When claiming property tax and mortgage interest you must divide these expenses between Form 8829 (time-space % amount) and Schedule A (the personal portion of these expenses). Since you will deduct less mortgage interest and property tax on Schedule A it will be more unlikely you will have enough expenses to itemize.
You can't deduct charitable deductions on your federal tax return unless you itemize on Schedule A.