Filing taxes can be a frustrating, if not intimidating, process but there are a number of tax prep resources available to child care providers.
Home Grown is a national collaborative of funders committed to improving the quality of and access to Home-based child care. The organization supports the development of tools and resources for business coaching to assist providers with savings, home ownership, debt consolidation, retirement planning and tax preparation. They’ve provided an online resource to streamline tax filing for child care providers.
Careful tax preparation is one of the most critical ways for Home-based child care providers to maximize revenue and reduce their risk of audit. According to Home Grown, providers can claim significant deductions related to operating a business out of their home. Each deduction enables providers to reduce their tax burden and increase profits.
This online resource is a free tool available to providers for a more in depth look at the requirements. It includes an expense worksheet to determine your operating costs, and what can and can’t be included in the total. For instance, did you know expenses related to advertising are tax deductible but not all meals are eligible? Information on stimulus check income is also included in the resource.
As always, keep tax records for four years after filing in case of an audit. The tax filing deadline is April 18, 2022 unless you file for an extension.