Can I Count Hours Spent Mowing My Lawn?
The most significant thing family child care providers can do to reduce their taxes is to track all the hours they spend in their home doing business activities.
This includes all hours caring for children, from the moment the first child arrives to when the last child leaves.
But, it also includes all hours spent on other business activities when children are not present.
Why is this so important?
Providers can deduct the business portion of virtually all expenses associated with their home: property tax, mortgage interest, house insurance, rent, house repairs, utilities and house depreciation. This represents thousands of dollars of business deductions.
The business portion of these expenses is based on a Time-Space Percentage calculation using the number of hours you work in your home and the number of rooms you use on a regular basis in your business. That means, the more hours you work in your home, the higher your Time-Space Percentage, the higher your tax deductions, and the lower your taxes
What might be included in these other hours?
The list is long: cleaning, record keeping, activity preparation, meal preparation, time on the Internet (reading this blog post!), talking to parents or other providers on the phone, parent interviews, planning menus and preparing shopping lists, Food Program paperwork, doing work for your family child care association or union, doing work to receive NAFCC accreditation or CDA, general office work, shopping for business items online, and more.
Here are some other guidelines:
You must be in your home or on your property to count these hours. Time spent attending training classes away from your home don't count, even though it's a business activity.
You can't count time twice. In other words, if children are sleeping and you are cleaning, you can't count the cleaning time.
You don't have to be the one doing the work. If you husband cleans up after the children on Saturday morning while you sleep in, you can count this time.
The general rule is that you can count hours spent on business activities in your home if you wouldn't be doing this work if you weren't in business.
This means you can't count time mowing your lawn. You aren't mowing your lawn more because you are in business, so the time doesn't count.
If you shovel your sidewalk/driveway at 5am before the parents arrive, you could count this time because you wouldn't be out at 5am doing this if you weren't in business. If your husband shoveled the snow at 4pm when the children were in your home, you couldn't count the time because you can't count time twice.
Cleaning time is probably the most hours you spend on business activities when children are not present. You can count all cleaning time spent immediately before the children arrive in the more and immediately after they leave. Don't count all the hours you spend cleaning your home. If you are cleaning the kitchen, bathroom and living room on Saturday and it takes you one hour, don't count the full hour. Keep records of all cleaning hours, business and personal to help support your claim.
To track all of the business hours when children are not present in your home, record two months of these hours carefully on a calendar and use the average for these two hours for the rest of the year.
Remember - Tracking hours when children are not present in your home is the most important thing you can do to reduce your taxes this year!
Tom Copeland - www.tomcopelandblog.com
Image credit: https://www.crewcut.co.nz/articles/lawn-tips/how-old-to-mow-lawn
For a comprehensive discussion on how to track your business hours, see my Family Child Care Record Keeping Guide.
