Family child care providers work long hours at their job.
How long? Very long.
Several national surveys indicate that family child care providers, on average, care for children eleven hours a day, five days a week. That’s 33% of the year. In addition, one survey said that providers work an average of 13.9 hours a week on activities in their home when children were not present. That’s another 8% of the year.
These are averages. You work hours may be longer or shorter.
I’ve helped two providers who cared for children twenty-four hours a day, seven days a week! They were audited and we won a Time-Space Percentage of 98% and 94%!
I’ve helped a provider who worked sixteen hours a week when children were not present and she won her case after being audited.
Why this is important
The more hours you work in your home, the lower your taxes.
The hours you work in your home, along with the amount of space you use in your home on a regular basis for your business determine what your Time-Space Percentage will be. This percentage is used to calculate how much of your house expenses you can claim as a business deduction.
Your house expenses include: property tax, mortgage interest, rent, utilities, house insurance, house repairs, and house depreciation. You can also use this percentage on all items that you buy that are used for both business and personal purposes: furniture, appliances, toys, household supplies, cleaning supplies, and so on. My book Family Child Care Record Keeping Guide lists over 1,000 allowable deductions.
Every hour and a half you work each week in your home is equal to 1% of the year. One percent of thousands of dollars of house related expenses is significant.
Keep accurate records
In the cases I cited above, the providers won their audits because they kept accurate records. That’s the key. Don’t worry if your hours are higher (or lower) than the average. You want to have daily attendance records (not just a contract stating what hours you are open).
The biggest record keeping challenge is tracking the hours you are working in your home when children are not present, doing things such as: cleaning, meal preparation, activity preparation, parent interviews, parent phone calls, time on the Internet, record keeping, (time reading my blog!), and so on.
Try to keep a daily record for at least two months each year of the hours you are working in your home when children are not present. See my articles on this:
How many hours do you work in a week?
Tom Copeland – www.tomcopelandblog.com
For more information on the Time-Space Percentage, see my book Family Child Care Record Keeping Guide.