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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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  #1  
Old 09-19-2010, 01:38 PM
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Default Taxes: How Do You Write Off Cable & Internet?

We are not a TV watching family..honestly..in fact we only have basic cable. i watch the Today show in the morning, and Bachleor on Mondays...That's it..Hubby writes music, so he doesnt watch ANY tv at all, and my son is a Apple technology junkie, and could care less about tv..So, with this in mind, the TV is turned on for personal use only 6 hours a week. However, with DC, it's on about 2 hrs a day, between morn/afternoon. So would i write off cable as a 50% business expense? or maybe even higher if it is used more for business rather than personal? Or would it still be time/space?

How do you write off yours?

And what about internet? I consider this site "educational' for business. I generally dont surf too often, just pay bills, ck on my ad on CL and email parents. so would my business use be higher than my personal? I was thinking of writing off the internet portion at about 75% business...but that's only for ME, what about the use for my husband & son? Would I consider them for my % also?

grrr....
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Old 09-19-2010, 03:33 PM
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You can deduct whatever you want, however you want, but the real question is will it survive an audit? That's best answered by a tax professional. Personally, I use the time/space percentage for all utilities, including cable and internet. Perhaps this link will help you with some of your questions (or not, as it's written by the IRS lol): http://www.irs.gov/businesses/small/...206004,00.html
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Old 09-19-2010, 04:34 PM
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I'm not really sure because I just take in all my totals, internet, cable, utilities, ect to my tax preparer and she figures out the persentage.
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Old 09-19-2010, 05:32 PM
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Yes. All my utilities are written off. My tax guy tells me what's deductible, and I give him the totals we pay. He takes care of all that. Even yard maintenance, fences, house repair, painting, gutters, everything!
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Old 09-19-2010, 07:49 PM
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How can you just take your bills and reciepts to a acct and say here...you figure it out? There has to be some "personalization", because he can't just guess at stuff...he doesnt really know how much time you watch TV, or on the internet, or how many clorox wipes you really used..So I don't understand how you can do this....

I can see how most utilities would be written off at t/s, but in my case with the cable, the cable is used more for business tha for personal, so how could it be t/s?
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Old 09-20-2010, 05:49 AM
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Quote:
Originally Posted by legomom922 View Post
How can you just take your bills and reciepts to a acct and say here...you figure it out? There has to be some "personalization", because he can't just guess at stuff...he doesnt really know how much time you watch TV, or on the internet, or how many clorox wipes you really used..So I don't understand how you can do this....

I can see how most utilities would be written off at t/s, but in my case with the cable, the cable is used more for business tha for personal, so how could it be t/s?
An accountant/tax preparer follows the guidelines set forth by the IRS, and that's how you can just give them your information and they prepare a return.

The question isn't how much you deduct, but would the deduction survive an audit by the IRS - with an agent sitting with you, asking you how you came up with the number you've deducted that's above your time/space percentage calculation? Just telling them, well, we're not really a TV family will most likely not fly and the deduction would be disallowed.

Now, will you get audited? Who knows what triggers an audit, but I would think that higher than normal deductions for things like utilities in a home daycare could be a trigger. Of course, since I'm not a CPA, this is just my speculation, and you really should find a good accountant if you are going to go with a method for deducting expenses that is outside of the guidelines used by the IRS, and keep impeccable and detailed records.
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Old 09-20-2010, 05:52 AM
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I use time/space percentage for all utilities also, Which is also what Tom copeland said at a seminar...........you can consider anything time/space percentage pretty much that you buy, Tom copeland said at one of the seminars as an example, "say you buy a scale at the store to weigh yourself, and you ask yourself, can I write part of this off? Sure you can, just have one of the daycare kids stand on it, and boom, its been used by daycare, so write it off"(time/space percentage, not 100%)
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Old 09-20-2010, 06:53 PM
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but isnt that really pushing it? Would it fly in a audit? A daycare wouldnt really need a scale.

Somethings are used for business more than personnal, like my printer...I use that constantly for business, and very rarely for anything else except for maybe directions ocassionaly.
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Old 09-20-2010, 07:23 PM
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That scale example was from tom copeland himself!
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Old 09-20-2010, 07:27 PM
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I just bought a new printer, and wrote it off 100% everything I print is for daycare, And I needed one upstairs that I could use while the children are around, And I will have no problem arguing that, if the time came, I would have never purchased a new one, were it not for daycare, and using it every single day for daycare, I type up my daily sheets during lunch time everyday, and print them. along with everything else. I think it is believable.
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Old 09-21-2010, 05:27 AM
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Yes the new printer is believeable! Just not the scale...LOL

I need to get a new printer/copier/scanner and I will write that off 100% and just use my old one for persoannal.
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Old 09-22-2010, 12:44 PM
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I use time/space percentage for all utilities
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Old 09-22-2010, 12:53 PM
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Quote:
Originally Posted by legomom922 View Post
but isnt that really pushing it? Would it fly in a audit? A daycare wouldnt really need a scale..
I've used a scale to weigh my kids. I have to know when they weigh too much for a PNP and so I am sure they are in the right carseat/boosters.

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I use time/space percentage for all utilities
Ditto.
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Old 09-22-2010, 07:36 PM
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Default TV and scales

You can deduct expenses that are "ordinary and necessary" for your business. This includes a television. When items are used for both business and personal use, the best way to deduct them is to use your time-space percentage. If you keep records to show that the actual use was greater than your time-space percentage, you can deduct a higher amount. However, you would need to keep accurate records to prove your business use. For example, track all the actual hours that your television is used for business and personal purposes for two months (that would be reasonable) and determine your actual business use percentage.
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Old 09-23-2010, 12:05 PM
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Thanks Tom! I appreciate it! Would that include keeping a log as to how much time you are on the computer for business purposes? I was thinking of getting a little notebook and logging time on/off for the computer and TV. Would this work then?
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Old 09-23-2010, 08:27 PM
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Default Television

Yes, if you track the business and personal time you are on your computer for two months a year you can claim a higher actual business use percent of its cost. A notebook would be perfect.
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