Welcome to KidKare’s collection of Tax Tips for your family home childcare business. We will update this post each week with new tax tips to help get you through tax season as easily as possible.

Note: This article is presented for information purposes only. Always consult a tax professional when filing your taxes.

Tax Tip: Beep! Beep! Your Ride to More Deductions is Here

Have you gone to the grocery store lately? You could claim mileage for that trip. However, more than 50% of the food you purchase must be for your home childcare business. Other business-oriented trips could include field trips, trips to the bank (though why go to the bank when ePay is right there?), and so on.

With KidKare Accounting, you can easily track mileage and other vehicle expenses. The Vehicle Deduction Comparison report gathers all this data into one, easy location. Your accountant will thank you! There’s a lot more you can do as far as vehicles and mileage for your business. Check out Tom Copeland’s tips in his article 2022 Standard Mileage Rate Announced to learn more.

Tax Tip: What is Your Biggest Tax Struggle?

Data based on a 2021 survey of 180 home childcare providers.
  • You use Time-Space% to determine how much to deduct from shared business and personal expenses.
  • You can count hours spent on your business when children are not present as time, which could lead to a 1% increase in your Time-Space %. It adds up to more than you think!

With just a little bit of data, our Time-Space % tool can calculate your Time-Space% for you. It’s really just, click, go, and done.

Tax Tip: It’s Not Too Late to Get Started!

Haven’t been keeping up with your expenses? There’s still time to get organized. It can feel overwhelming, so take a moment to stop, take a deep breath, and let it out slowly. You’ve got this.

Gather your receipts and make a plan. Commit to inputting your expenses a little bit at a time. With KidKare Accounting, you can add expenses all the way back to January 2021 (and beyond). Categorize each one to ensure you are reporting the correct expense on the correct form.

Tip! Keep copies of your receipts even after you add them to KidKare. They are important expense records, too!

Once you’re done, all you have to do is print reports, such as Schedule C Expenses and Form 8829, directly from KidKare. Provide these reports to your tax professional or, if you are doing your own taxes, transfer the numbers to your return. Tax professionals love our reports!

For more tips about how to use KidKare for your taxes, check out Tom Copeland’s recent blog Questions and Answers About KidKare where he answered KidKare-specific questions received at his last webinar.

Try us free for 30 days and cut down tax season stress. You’ll quickly find out why Tom Copeland named us the nation’s leading family child care record keeping online software program.

Tax Tip: Reduce Your Taxes

Last week, we talked about the importance of counting hours when children are not present, and we thought it bared repeating. Keep a record of all your hours of work—and document it—so you can apply that work time for your taxes. Don’t take our word for it: According to Tom Copleand, calculating your Time-Space % is the most important thing you can do for your taxes.

And, to apply this to your taxes you need to document every, singe hour spent on activities, such as:

  • Cooking & Preparing Meals
  • Unloading Groceries for Your Business
  • Cleaning Before and After Children Leave
  • Record-keeping
  • Parent Interviews

Source: What Hours Can You Count?

This is by no means an exhaustive list. It helps to ask yourself this question: “Would I be doing this if I wasn’t running a business?” If the answer is YES, then, chances are, you can count this in your Time-Space %.

Do you have a recordkeeping solution in-place? Let us tempt you with 30-days of KidKare Accounting for free, so you can log work hours and calculate your Time-Space % in the same place. It’s as easy as click, go, done! Learn more here.

Always consult a tax professional when filing your taxes.

Tax Tip: Work Hours When Children Aren’t Present & Your Time-Space Percentage

It’s the first day of February and Tax Tip Tuesday once again! We have a question for you: Do you track all of the hours you are working? Cleaning, doing paperwork, running your billing, tracking your expenses, and more count as work hours, too.

In fact, the average number of hours that family childcare providers work after children are gone is a staggering 13.9 hours a week*.

Your Time-Space percentage is the proportion of your home that you use for business purposes. This figure lets you know how much of your shared business and personal expenses can be deducted as a business expense. To determine this, you have to multiply your Time % by your Space %.

Tom Copeland, The Nation’s Leading expert on the business of Family Childcare

Since Time-space percentage is calculated using your time and the space used in your home for business, if you’re leaving your children-not-present hours out of the equation, you could be leaving a lot out of your home business tax deductions. Whether you track with accounting software, on a spreadsheet, a Word document, or even on paper, track every hour spent on your business.

And, at KidKare, we understand every second counts, so we have created a solution to make Time-Space % calculations easy-breezy. Check out the video below to see how KidKare Accounting can make it easy for you to track all of your work hours and calculate your Time-Space %.

KidKare Accounting can help cut tax season stress by taking the guesswork out of your Time-Space %. Try us free for 30 days!

*Per Tom Copeland, the nation’s leading expert on the business of Family Childcare.

Tax Tip: Every Expense Counts!

Happy Tax Tip Tuesday (January 25, 2022)! Today, we’re talking about something incredibly important to any small business: expenses.

When you run a small business, every tax deduction matters, which means every expense counts. Every. Single. One. You should be tracking expenses for items used in your business throughout the year so you can get the most out of your childcare business tax deductions.

What sorts of items could you deduct? Here’s just a few:

  • Software
  • Toys
  • Pots & Pans
  • Silverware
  • Food
  • Vehicle Mileage
  • Furniture
  • COVID-19 Supplies (Gloves, Masks, Disinfectants)

Remember! Items are only deductible if they are actually used for your business. Consult a tax professional for more information. Check out Tom Copeland’s blog End of Year Tax Savings Tips for more information on the sorts of things you can deduct on your taxes for your childcare business.

Tax Tip: Common Q&As About KidKare Accounting

This Tax Tip Tuesday (January 11, 2022), we’re answering some common questions about KidKare Accounting!

Can I use KidKare if my Food Program sponsor doesn’t use KidKare?

Yes, you can always use KidKare Accounting even if your sponsor doesn’t use it for claiming meals and snacks. You can use KidKare Accounting to track parent payments and all business expenses for your childcare business. Learn more and sign up here.

Does KidKare print out a Form W-10 for parents at the end of the year?

Yes! In fact, KidKare Accounting can populate this form with the amount each parent paid (as long as payments are recorded).

If I purchase KidKare Accounting today, can I enter business expenses from January 2021?

Yes! KidKare Accounting allows you to enter expenses incurred prior to your purchase date. You can record expenses as far back as needed.

Tax Tip: Ready or Not, Here Comes Tax Season

With a new year comes a new tax season, and you know what that means—It’s time to get your finances in order. Have you been tracking your expenses?

If the answer is a big, resounding “No,” we have a solution for you!

KidKare Accounting is an easy-to-use software that allows you to enter all your expenses and income from the beginning of the year. This means you still have time to record your 2021 business expenses, so you can print the reports you need.

These reports can make tax time a breeze:

  • Schedule C: Business expenses
  • Form 8829: House expenses
  • Actual Food Expense: Food expenses
Tax tips for use with KidKare Accounting: record expenses, calculate time-space percentage, and generate tax reports.
Tax season could be even easier. Try KidKare Accounting free for 30 days, and turn your taxes into a simple, click-and-go experience. Click here to learn more and sign up for your free trial today.

KidKare Accounting can do even more for you throughout the year. Want to learn more? Browse our digital handbook here.

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