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Daycare and Taxes>Taxes For Babysitting?
Unregistered 06:24 PM 08-20-2012
I was laid off my job (daycare shut down) and now I am currently babysitting one child during the week at my house. She is only part time, and each week's schedule changes. Some weeks she comes 4 days, others only 2. And some weeks she may not be here at all. As long as this is the only child I have, how will this affect my taxes? The mom pays me between $70/week to $140/week (more because I pick her up and drop her off). I've never had an income without actually being employed by someone who takes taxes out for me and everything, so I don't know what to do about taxes now. Advice, please? (I do not run a daycare business in my home. It's just one child 1-4 days each week, sometimes maybe not at all).
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TomCopeland 09:36 AM 08-21-2012
If you earn any money at all caring for children in your own home, you are running a family child care business. You must report all your income on IRS Form Schedule C. If you are exempt from your state's child care licensing laws you can deduct all the same expenses as a licensed child care provider.

If you are in violation of your state's laws then you cannot deduct house expenses (property tax, mortgage interest, house insurance, house repairs, utilities and house depreciation) but you can claim all other expenses: food, toys, supplies, furniture, appliances, car expenses, etc.
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Unregistered 02:08 PM 08-23-2012
Thank you, Tom. I didn't know how that worked since in my state you can have as many as 5 children before you need to be licensed. So even though I'm not licensed, I am still considered a family childcare home, which also means I can claim my expenes. Since I pick the child up and drop them off, can I count gas? And what types of documentation will I need to show my expenses used for caring for the child?
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TomCopeland 08:44 PM 08-26-2012
Originally Posted by Unregistered:
Thank you, Tom. I didn't know how that worked since in my state you can have as many as 5 children before you need to be licensed. So even though I'm not licensed, I am still considered a family childcare home, which also means I can claim my expenes. Since I pick the child up and drop them off, can I count gas? And what types of documentation will I need to show my expenses used for caring for the child?
You can use the standard mileage rate ($.555 for 2012) to claim car expenses, or you can save all your receipts and claim the business portion of them.

To show expenses for your business save receipts. If you don't have a receipt save canceled checks, credit card statements, written records or photos.
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