Time/Space for Another Type of Business?

[Boymom]

I have a very odd question and forgive me if this is a dumb question LOL! I'm not sure how much longer I will be a daycare provider. I just don't know if it's my cup of tea!!! If I were to have another business in my house not daycare related, would I still do the time/space thing and could I write off part of the utility bills? Or is that just for home daycares? Like if I make wreaths or cakes or something similar, could I track the hours I spent advertising, time spent making the product, etc? I didn't know if other businesses could do that or not! Just lots of thoughts bouncing around in my head!

[Mike]

Any business that uses part of the home can claim the fair share of expenses. Just have to figure out what percentage is related to each business.

[TomCopeland]

Originally Posted by Boymom

I have a very odd question and forgive me if this is a dumb question LOL! I'm not sure how much longer I will be a daycare provider. I just don't know if it's my cup of tea!!! If I were to have another business in my house not daycare related, would I still do the time/space thing and could I write off part of the utility bills? Or is that just for home daycares? Like if I make wreaths or cakes or something similar, could I track the hours I spent advertising, time spent making the product, etc? I didn't know if other businesses could do that or not! Just lots of thoughts bouncing around in my head!

The rules for deducting home related expenses (property tax, mortgage interest, utilities, house insurance, house repairs and house depreciation) are different for all other businesses besides family child care. For every other home-based business the business must have at least one area that is exclusively used for the business. This means no personal use ever. There is no tracking of hours. So, if 200 square feet out of a 2,000 square foot home was used exclusively for the business, the business could deduct 10% of the house-related expenses. For non house related expenses (food, equipment, computers, desk, etc.) you can deduct the business portion, based on what percentage of the time it was used in the business.