What you can expect from anyone reviewing your tax documents:
* To be treated with respect during the review process with absolute confidentiality concerning your documents. Tax documents should never leave the review site unless you are bringing them to your tax preparer.
* An expectation of confidentiality extends indefinitely.
* To only be asked for documents directly related to your tax preparation.
Although many family child care programs hire a professional tax preparer to complete their quarterly and yearly taxes, it is a wise provider who is knowledgeable regarding taxes and takes the time to thoroughly review all tax documentation prior to signing it.
Watch the 3 minute video below regarding how to find a Tax preparer adapted from Tom Copeland's article, "Choosing the Right Tax Professional" found on the National Association for Family Child Care website.
* To be treated with respect during the review process with absolute confidentiality concerning your documents. Tax documents should never leave the review site unless you are bringing them to your tax preparer.
* An expectation of confidentiality extends indefinitely.
* To only be asked for documents directly related to your tax preparation.
Although many family child care programs hire a professional tax preparer to complete their quarterly and yearly taxes, it is a wise provider who is knowledgeable regarding taxes and takes the time to thoroughly review all tax documentation prior to signing it.
Watch the 3 minute video below regarding how to find a Tax preparer adapted from Tom Copeland's article, "Choosing the Right Tax Professional" found on the National Association for Family Child Care website.
One criterion Kelly Matthews, Family Child Care Business specialist, has for any tax preparer she hires, "They must be familiar with Tom Copeland's work on family child care business."
Click on any of the documents below to open. These are simply here as a visual reference to the tax documents referred to in this tutorial. Save to your computer or consider printing if you would like. These documents do not open in a new window, so you will have to click on the 'back arrow' in the upper left corner of your computer screen to go back to the tutorial. These are all PDF files, therefore, they are not electronically fill able.
Provider as Sole Proprietor
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The document below is the worksheet a provider will use to support the Schedule C. As mentioned in the Record Keeping section, tracking hours worked in the home will support completing this document. On the 8829, line 7 is the Time/Space-Percentage that Tom Copeland talks about.
This is the amount that a provider is able to write off certain shared expenses between home and business. This percentage is unusually high for family child care because this provider had exclusive use space. Most providers' Time-Space percentage is between 25-35%.
This is the amount that a provider is able to write off certain shared expenses between home and business. This percentage is unusually high for family child care because this provider had exclusive use space. Most providers' Time-Space percentage is between 25-35%.
sample_8829_child_care.pdf | |
File Size: | 1131 kb |
File Type: |
Provider is Multi-member LLC
Quarterly Reports
Quarterly Reports
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Federal Income Tax Return
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State Income Tax Return
formwt-7.pdf | |
File Size: | 330 kb |
File Type: |
Questions to consider...
Consider how you would answer these questions -- use your answers to develop and implement financial practices and policies that will help support the financial health of your business.
1. How do I know what I can and cannot write off for my business?
2. Do I ever meet with tax experts to make sure I am up to date and understanding current tax laws, including proper procedures for writing items off, requirements for paying quarterly and other taxes, and other relevant tax issues?
1. How do I know what I can and cannot write off for my business?
2. Do I ever meet with tax experts to make sure I am up to date and understanding current tax laws, including proper procedures for writing items off, requirements for paying quarterly and other taxes, and other relevant tax issues?
YoungStar Requirements
Under the Business and Professional Practices section of YoungStar, family providers are required to complete timely and accurate tax documents. This can be documented by having signed or electronically filed copies of all of the following:
1. If the Provider is a sole-proprietor or single-member LLC:
* Copy of the Federal 1040 (including Schedule C)
2. If the Provider is a multi-member LLC:
* Copy of last 4 quarterly 941 or 944
* Copy of last year's Federal Income Tax Return (Form 1065, Form 1120, Form 1120S, OR Form 990)
* If the Provider has employees:
Copy of last year's State WT-7 OR W3
What you can expect from Rating Observers and Technical Consultants regarding Tax Documents:
* Documents may be reviewed by the Rating Observer or Technical Consultant while not in the presence of the provider/director as part
of the review/technical consulting process.
* Rating Observers and Technical Consultants will at all times maintain confidentiality in regards to any and all contents of the reviewed documents.
* Rating Observers and Technical Consultants responsible for reviewing tax documents will at all times protect documents during the review/consultation in such a way that no unauthorized party is able to access the documents.
* In preparing your tax documents for a YoungStar review, you have the right to protect your privacy. You may black out social security numbers on any tax documents.
1. If the Provider is a sole-proprietor or single-member LLC:
* Copy of the Federal 1040 (including Schedule C)
2. If the Provider is a multi-member LLC:
* Copy of last 4 quarterly 941 or 944
* Copy of last year's Federal Income Tax Return (Form 1065, Form 1120, Form 1120S, OR Form 990)
* If the Provider has employees:
Copy of last year's State WT-7 OR W3
What you can expect from Rating Observers and Technical Consultants regarding Tax Documents:
* Documents may be reviewed by the Rating Observer or Technical Consultant while not in the presence of the provider/director as part
of the review/technical consulting process.
* Rating Observers and Technical Consultants will at all times maintain confidentiality in regards to any and all contents of the reviewed documents.
* Rating Observers and Technical Consultants responsible for reviewing tax documents will at all times protect documents during the review/consultation in such a way that no unauthorized party is able to access the documents.
* In preparing your tax documents for a YoungStar review, you have the right to protect your privacy. You may black out social security numbers on any tax documents.
Disclaimer: Materials and links provided by WECA on this tutorial do not constitute legal, accounting, tax or finance advice. Participants seeking professional business advice about specific aspects of their program should consult a professional such as a lawyer, accountant, etc.