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Daycare and Taxes>New Daycare And MMK - When To Start Recording Expenses?
Christophina 01:10 PM 12-28-2010
So I started daycare this year. I started purchasing things and paying for training back in July. My first child started on August 30th. My question is: In minute menu kids, when do I start recording expenses like rent and power? August? July? Also, when is my technical start date? And for my time/space %, can I count all the time from before my first kid started? And finally, I didn't realize until too late that I needed to keep track of every minute of every week that I worked outside of daycare hours, can I just guestimate or do I have to have concrete proof of everything? Sorry for all the questions, I am just so confused!!
TomCopeland 09:22 AM 12-30-2010
You can claim expenses for your business in 2010 for everything you bought for your business even before you started caring for children. So, count the training, toys, smoke detector, etc. you bought before you started caring for children.

Start claim expenses for your home when your business began (August 30). Start counting the hours you worked as of the first day you started caring for children. Then divide these hours by the total number of hours in the year after that date. This is the easiest and fairest way to calculate your time-space percentage.

As a general rule, try to track carefully the hours you worked after the children were gone for at least two months every year. Use this average for the other months. So, let's say you worked 30 hours in November and 20 hours in December and you entered these hours in Minute Menu. The average is 25 hours a month. Enter 25 hours a month for the other months in 2010 that you were in business. If you didn't track these actual hours for two months in 2010, start tracking them for January and February of 2011 and use this average for 2010. Do another two months for 2011.
Christophina 09:55 AM 12-30-2010
Thank you so much!! That makes a lot of sense. One last question: If I can start claiming expenses for my home beginning August 30th, does that mean that I can claim my power bill that was paid August 31st, even though the usage was from before August 30th?
TomCopeland 05:10 PM 12-30-2010
You can claim expenses in the month you pay them. So, you can deduct the business portion (time-space percentage) of your August 31st bill because you were in business on August 30th. You won't be able to deduct your December 2010 utility bill until 2011 when you pay it.
dEHmom 06:56 AM 01-08-2011
ok, so I haven't done any accounting yet for this year.
I took on my first 2 full timers in May, and they lasted about 2 months. Then I took on a casual in August. She is still with me and her hours vary greatly.

I have saved all my receipts, but I never separated the business/personal expenses. I was told tally everything on the bills, and then do the formula for time/space/expense. I am in Canada btw.

If I wanted to go backwards now, and tally for the months I just don't understand. Besides, i haven't made enough to be taxed, do I still get to claim the deductions, or should I just not bother with the all that this year? I'm so confused.

Does anyone know of a free software program download that would work like minute menu for in Canada?
TomCopeland 09:00 AM 01-10-2011
Since you are in Canada my previous answer may not be accurate. Canadian tax rules for family child care providers may be different than the US. Check with your local tax authorities.
Tags:minute menu kids, mmk, money management, records
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