With summer at hand, record keeping is probably the last thing on your mind.
But, the end of June is a good time for a six-month review of your business records.
Maybe you are doing a pretty good job of saving your receipts. But, unless you are paying close attention to all the records you should be saving throughout the year, you may be creating a bigger job for yourself at the end of the year.
Here’s what you can do to review your records now. If you are missing something, now is the time to reconstruct your records.
* Have you recorded all payments from parents, subsidy program, Food Program, grants, etc.?
If not, identify and record income you haven’t previously recorded. See my article “Tips on How to Report Your Income.”
* Do you have accurate daily attendance records?
If not, reconstruct the days and hours children were in your care and start tracking this going forward. Attendance records can help show how many hours you worked and how many meals and snacks you served. Both of which will help you reduce your taxes.
* Have you recorded all the hours you used your home for business purposes when day care children were not present?
If not, pick two months between now and the end of the year to carefully track these hours using the KidKare software or some other method. Use the average from these two months to estimate an annual total. The more hours you work, the higher your business deductions. See my article “How to Track Hours When Children are not Present.”
* Have you kept records of all the business trips you have taken so far this year?
If not, go back and reconstruct these trips using receipts, cancelled checks, credit/debit card statements, calendar notations, etc. The standard mileage rate for 2017 is $.535 per mile.
* Have you saved all of your receipts?
If not, look to see if you have other records that show you bought items used for your business. These can include cancelled checks, credit/debit card statements, photographs, written records. See my article “How to Keep Records for Craigslist and Yard Sale Purchases.”
* Do your receipts clearly identify what you bought and how much it cost?
If not, mark the receipt with what is missing (date, name of item, cost, where it was purchased). You may want to start scanning or copying receipts that are fading. See my article “The Case of the Fading Receipt.”
Going forward I recommend that you review your records on a monthly basis to avoid having to sort through a mountain of records at the end of the year.
The Child Care Business Partnership
If you are a member of The Child Care Business Partnership I can help you review your records at this half way point in the year. I can look at your reports and tell you how well you are tracking your income and expenses. Many providers are not saving receipts for items they can deduct (lawn maintenance service, cleaning supplies, light bulbs, and so on).
If you have the KidKare software you can join The Child Care Business Partnership and receive these benefits:
* Over 20 instructional videos on how to save time and money using this software
* Individual assistance from me in reviewing your records and tax return at the end of the year
* Help if you are audited by the IRS
It’s only $15 a year and is 100% tax deductible!