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Daycare and Taxes All things related to Taxes and running a Daycare post here. Topics of tax exemptions, forms, filings, tax write offs, IRS etc. |
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#1
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How Many Hours Do You Average Out a Year?
I was wondering what kind of hours everyone averages out at the end of the year?
Total hours worked? Total hours of prep, cook, clean, shopping, phone calls outside of daycare hours? My tax lady said If I keep track of my prep, cook, clean, shopping, phone call, etc. hours for a couple of months that she could just take an average of time spent extra out of daycare hours itself..... I was just wondering how everyone else does it? Do you keep track down to the minute of every phone call you have outside of daycare to every minute spent on cleaning up after daycare or how do you all do this? Honestly I never feel like daycare ends at my house! LOL from cleaning, to shopping, to preperation.... never ending job - how do you break up hours for this? |
#2
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Okay, so here's a little tid-bit about how to figure this out. First off the time that you should keep track on and claim only counts if it's time that you, your spouse, another family member or an employee spends working in the home for daycare related activities during hours that children are not present. These hours can be added to your working hours to figure out what your time% is.
For example: If your hours are 6AM-6PM and your first child arrives at 6AM, your last child leaves at 6PM and there are no gaps in between and every morning from 5:30AM to 6:00AM you start preparing, arranging the room, setting up the toys for the kids whatever and every evening from 6:00PM to 6:30PM you spend time cleaning up and putting daycare things away then you can claim this time and should log these and keep track of them. Here are some examples of what you should log (when the kids are not there): • Cleaning the rooms in your home that is used by your daycare • Preparing food and meals for the DC kids • Reading to find recipes for the DC (magazines, internet, books) • Planning lesson plans • Preparing lesson plans (getting the activities ready) • Decorating the home (putting up posters, holiday decorations, putting up the crafts that the DC kids made) • Record Keeping • Planning menus • Preparing shopping lists • Interviews with prospective parents • Talking to parents and other providers on the phone about daycare • Research • Time spent networking on Daycare forums for advice!!!! Hint hint Any time you spend doing daycare related things while the kids are there like cooking and cleaning etc. don't count though. They only count if there are no DC kids in your home. In one of Tom Copeland's books he actually tells you to hang out and not do work like this until after hours so that you can claim it. His actual words are "What should you do when children are taking a nap? Rest, read a book, do nothing!" . More hours that don't count towards this are things like time spent away from the house like trainings, shopping etc. for daycare related things. For these you should keep track of the mileage but the actual time you spend doing these does not count. Also time spent on general house repairs or maintenance does not count such as cutting the lawn, replacing light bulbs etc. This is all stuff that you would have to do anyway whether or not you had a daycare. These types of things can only be counted if more time was spent on this because of the business such as having to repaint the home every year because of the damage caused by children. Theres an entire chapter in Tom Copeland's book called Family Childcare Record Keeping Guide titled Figuring Your Time-Space Percentage that talks all about how to do all of this. I highly recommend this book. Borrow it, buy it, steal it (ok maybe not lol) or check it out at the library. *** On that note, I keep track of my DC related hours when the kids aren't here in a notebook. Wondering if anyone had an actual log that they use that I could see. I'm trying to adopt something easier for me to fill out and keep track of. Last edited by MarinaVanessa; 10-15-2010 at 09:18 AM. Reason: Pregnancy brain doesn't let me spell correctly |
#3
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Oh and sorry, while I was busy explaining the whole concept of what was allowed and what wasn't I totally forgot to answer your questions . I blame it on the prego brain.
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#4
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Im not exactly sure but it feels like 7 million,... now logisticly I know that cant happen,.. but it does consume alot of my time,... lol. My time space percent is like 38%
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#5
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Counting Hours
Counting the hours you spend on business activities in your home after the children are no longer present is probably the single most important thing you can do to reduce your taxes. Every 2 hours you work per week on these activities increases your Time percent by 1%. That's a lot when applied against thousands of dollars of house related expenses.
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http://www.tomcopelandblog.com |
#6
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I would be lost without that thing; my dh calls it my external memory! Believe me it has come in handy at tax time more than once. |
#7
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#8
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Thanks for the info guys! I need to figure it all out, I feel like I spend so much time on daycare outside of daycare hours, but I don't want to sound stingy and claim all of the hours and get audited or something because of it! Does that sound crazy? I feel like on average I spend 30 hours/week outside of my 50hr/week daycare hours! Does that seem like a lot? I think it all adds up because we live in the middle of NO where and no matter where I go it is an hour drive there and back, which adds up real fast! I don't know how to figure out time/space percentage is there an equation or a simple way to figure this out?
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#9
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MarinaVenessa,
I just reread your post! So the time you spend buying things like groceries and supplies does not count? You can just use the milage of getting there and back, but not the time you spend doing these things? Is that correct - if so wow I waste ALOT of time on daycare for it not to be counted and then I need to go back and recalculate all of my outside of daycare hours! |
#10
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I know of a provider in your shoes that lives out of the way of stores and such and so she buys a lot of her supplies online after DC hours so that she can claim the supply cost, time it takes her to shop for these things, shipping etc. Bummer huh? This includes any training you may need that is required. You can claim the cost of the training, the mileage, supplies required etc. but if it's a 6 hour training you can't claim the time. |
#11
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THANK YOU, so so much MarinaVanessa!! You have been great helping me to understand this all!! ((((((hugs))))))) That stinks that we can't count travel time and the time we spend in trainings and shopping! Ouch - that really stinks, I am going to have to go back and reconfigure all of my hours! I think I will shop online like your friend! This would save me a TON of time!! Just wanted to say thank you so much for taking all of this time and explaining it all to me!! I know where to find the answers next time!!
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#12
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One more thing so if I am open from 7am - 5 pm Monday - Friday = 50hours a week with children in my care!
I had written down that I spend about 30hours more on all the prep, clean up and such, but in this amount I had travel time, training time and shopping time - so now I need to go back and take tha all out as it does not count!! I guess my question is what is a good average amount of time you guys spend outside of daycare hours on all the extra stuff, just so I know where I stand as far as that! I spend alot of time on daycare, probably more than I should, but I am just wondering if anyone has an average amount of hours so I know where I would stand relative to everyone else! Thanks! |
#13
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Oh and thanks for the kudos, I only know all of this because I've been there done that lol. And of course I read and re-read Tom's books. Really, his books have been a lifesaver. |
#14
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I know this post is super ancient, but is their a standard weekly amount of time we can use instead of writing it all down? I can go back and write down my attendance hours I worked with kids, but I probably spent 10+ hours a week cleaning, cooking, and doing other daycare related tasks in the home.
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hours, hours of operation, tax write off, tom copeland, total hours worked |
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