The Learning Ladder II

A reading and writing curriculum for Family Child Care Providers, Children and Families

Module 6: Family Child Care as a Business

Part 1

Part 2

Part 3

Part 4

Part 5

Learning Activity

This activity gives you the formula that you can use to determine the partial deduction for your home. Let's find out the amount you can legally deduct on your taxes for the use of your home:

Measure and figure out the percentage of home space you use doing day care.
for example: I use 3,200 square feet for my program. My apartment is 4,000 feet. The percentage of space that I use for my family child care business is 80%.
Figure out the percentage of time in a year that your home is used for child care.
for example, I provided 2,600 hours per year divided by 8,760 total hours per year and this equals 30%
Multiply the space percentage by the time percentage:
For example: I am going to multiply 80% x30% =24%

In the example given, I can claim 24% of rent, utilities, and property taxes on my taxes as a business expense of running a family child care program.

Writing Activity

Many family child care providers do not want to figure out their taxes by themselves. They go to a tax preparer who knows about family child care. Please make a list of the record keeping and documentation that you would bring to a tax preparer. Include in this list specifics about how you keep these records.

for example: "The amount of income I get from parents and the government: I keep a notebook that records parents checks and government checks with a pocket for copies of the actual checks."

This is how much of Module 6 you have completed:


Nice work! You finished Part 3. Now go to Part 4.