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Dabill 03:47 PM 12-15-2017
Hello, I am new here and have some questions! I am interested in starting a family daycare, but only if I can use a separate space. I was considering building an open, non-home like building, but it would be considered a commercial building requiring it to pass the same inspections as a center. That would be costly, so now I'm looking into building an actual home that is only used for daycare. I was told that as long as it's built as a home, it would be considered residential even if I don't live there. I have many questions,but first I am interested in how tax deductions would work in this scenario. Since everything there would be used only for the business, could I deduct 100% of space, utilities, etc? I am located in Minnesota. Any info helps! Thanks!
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Blackcat31 03:59 PM 12-15-2017
Originally Posted by Dabill:
Hello, I am new here and have some questions! I am interested in starting a family daycare, but only if I can use a separate space. I was considering building an open, non-home like building, but it would be considered a commercial building requiring it to pass the same inspections as a center. That would be costly, so now I'm looking into building an actual home that is only used for daycare. I was told that as long as it's built as a home, it would be considered residential even if I don't live there. I have many questions,but first I am interested in how tax deductions would work in this scenario. Since everything there would be used only for the business, could I deduct 100% of space, utilities, etc? I am located in Minnesota. Any info helps! Thanks!
Welcome to the forum!

I am also in Minnesota.
I also provide care in a house in which I do not live.
I have operated this way since I opened (mid-90ies)
I am licensed as family care.

There are several women that operate this way in my community. One operates FAMILY child care in a commercial building and is licensed as family care (rule #2)

If you have any questions and I can be of help, don't be shy!
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Dabill 04:17 PM 12-15-2017
Thank you in advance for your help! I am mostly interested in how tax deductions work. Are you able to deduct 100% of your daycare homes expenses?
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Blackcat31 05:22 PM 12-15-2017
Originally Posted by Dabill:
Thank you in advance for your help! I am mostly interested in how tax deductions work. Are you able to deduct 100% of your daycare homes expenses?
Yes, everything is for the business.
I donít do my own taxes so I donít know the complexities of it all but yes every expense is counted.
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Dabill 05:33 PM 12-15-2017
Originally Posted by Blackcat31:
Yes, everything is for the business.
I donít do my own taxes so I donít know the complexities of it all but yes every expense is counted.
Ok.. I'm trying to figure out if I'd be able to make enough income after paying the mortgage, utilities, etc.. after I get started I would like to have my mom work with me, which would be another expense.. I just think it'd be nice to have a separate space and be able to leave your job!
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Blackcat31 06:24 PM 12-15-2017
Originally Posted by Dabill:
Ok.. I'm trying to figure out if I'd be able to make enough income after paying the mortgage, utilities, etc.. after I get started I would like to have my mom work with me, which would be another expense.. I just think it'd be nice to have a separate space and be able to leave your job!
I make a pretty nice income.
You are planning well!

I am licensed for 12-14 and usually have 12
I donít take kids once they start school.
My DH is also self-employed and assists as a second (licensed) caregiver when necessary so I donít currently have an employee that I have to pay but have in the past.

If you your area has the need for care options and you can buy/built efficiently you can absolutely turn a good profit.

Know your areaís needs and create a good business plan.
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Tags:deduction, separate building for daycare, tax advice
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