Questions and Answers

Your Questions About X100

May 4, 2013

Linda asks…

my wife does daycare,What can she deduct for income tax purposes?

My wife has children mainly before and after school, what are the tax right offs?

Administrator answers:

Assuming she is running an unincorporated business then all expenses directly related to the business are deductible. Toys, food, pillows, blankets, etc. Add advertising costs, (including Internet if you use it in your business), mileage for getting supplies and banking plus and costs incurred to prepare income taxes.

In addition a percentage (dedicated square footage divided by total square footage X100%) of your home expenses excluding mortgage interest is also deductable including heat, hydro, water, etc. The same for outside expenses such as lawn care, snow removable, and landscaping. Any maintenance items in or outside are also eligible to be deducted by the same % amount such as furnance, plumbing, duct cleaning, window washing, etc. Also add in insurance costs and property taxes.

If you do not have a dedicated business line you can deduct a portion of your house phone expenses (I use 50/50). If the kids watch TV throw in a portion of cable expenses as well.

Quite a list! If the business was incorporated then you could add on to the % deductability of the house any interest paid on an outstanding mortgage.

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