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Daycare and Taxes>New In Home DC Tax Questions...
voymom 12:17 PM 08-24-2013
Hello everyone! I am new to all of this child care stuff so I need LOTS of help, especially when it comes to taxes, since numbers are not my strong point lol.

I am license exempt for up to 5 children. I currently watch 2 children, with the ability to bring in one more full time child.

How do I figure out if I need to pay in taxes? I'm looking at between $3000-$5000 in income per year. I have been looking at the IRS website, but everything is just confusing me even more.

I read this on the IRS website:

Who Must Pay Estimated Tax
If you are filing as a sole proprietor, partner, S corporation shareholder, and/or a self-employed individual, you generally have to make estimated tax payments if you expect to owe tax of $1,000 or more when you file your return.

How do I know if I am expected to pay $1,000 or more in taxes?

I have read the PDF file that is supposed to help you figure that out, but again, it only confuses me more.

My husband and I filed jointly last year, he claims 7 on his federal taxes since I am a stay at home mom with no income, so we needed the extra money on his paychecks. Not sure if that matters here or not lol.

I have read through most of the threads on taxes for the forum, but I suck with numbers. I need some massive help.

I just recently( a month ago ) started watching the 2 children in my home, with hopes of adding more children in the future. The parents do not plan on using the child care expenses on their taxes.

I am using this link from the IRS to try and figure it out: http://www.irs.gov/pub/irs-pdf/f1040es.pdf

I am using Schedule Y-1 for married filing jointly

It says that if I am not making $17,850, then I do not owe any taxes in? Is this correct?

On schedule Y-2 married filing separately the amount you cannot go over is $ 8,925, if I am not making more than that, do I not have to pay taxes in?

With all of this confusing stuff said....do I still file quarterlies? Do I still claim the income for 2013?
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Michael 05:14 PM 08-24-2013
We have a pretty thorough section on taxes and daycare which is frequented by author Tom Copeland. https://www.daycare.com/forum/forumdisplay.php?f=8
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TomCopeland 11:28 AM 08-25-2013
Welcome to the Forum
Estimated taxes: Use a figure of 20% of your gross income as an estimate of what you will owe for federal income and Social Security taxes. Your husband can withhold this additional money so you won't have to file quarterly. See my article on this:https://www.tomcopelandblog.com/blog...imated%20taxes

You must always report any money you earn caring for children, regardless of whether or not the parents are claiming the child care tax credit. Depending on your tax bracket, you will owe federal and state income taxes and Social Security taxes - so you will always owe some taxes on your earnings, even if you earn only a few thousands dollars a year.
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