COPYRIGHTED MATERIAL Introduction This book is designed for family child care providers who are working with a tax pro- fessional or who would like to do so. It includes suggestions for finding and choosing a tax professional, an organizer that will make providing information to your tax profes- sional easier, and checklists to help you review your tax forms before submitting them. This book will also help your tax professional understand the special tax rules that apply to family child care businesses and take advantage of all the business deductions that you’re entitled to claim. This book has two parts: Part 1 can help you locate a qualified tax professional and determine if he or she is familiar with the special tax rules for family child care. Part 1 also explains how to go about resolving any questions or disagreements that may arise when working with your tax professional. Part 2 is the Tax Organizer. It provides clear, detailed instructions for gathering and calculating the information that your tax profes- sional will need to complete your business tax forms, including Form 8829, Form 4562, and Schedule C. It also includes a review checklist for each of these tax forms so you can easily double-check them and discuss any questions with your preparer. The organizer can help save you money by ensuring that you pay only the taxes that you owe. It can also reduce your stress by making it easier to gather the information for your tax professional and by helping you feel more confident that your tax professional is filling out your tax return accurately. You can use this book if you meet your state’s child care regulations or are exempt from them, as long as you file your tax returns as a sole proprietor (self-employed per- son) or as a single-person limited liability company (LLC). If you file as a partnership or a corporation, you must file different tax forms and follow different tax rules than those described here. Licensing Status and Tax Rules You can take advantage of the tax rules described in this book based on your licens- ing status as a family child care provider. If you meet your state’s child care licensing rules, you are entitled to claim all of the deductions associated with your home and business described in this book. If you are exempt from your state’s child care licensing rules, you are entitled to claim the same deductions as if you were licensed. Let’s say, for example, that your state requires you to have a license if you care for children from more than one family. If you care for children from only one family, you are exempt from licensing rules and are entitled to claim the same deductions as if you were licensed. If you are in violation of your state’s child care licensing rules, you are not entitled to claim business expenses associated with your home, such as your property tax, mortgage interest, utilities, house repairs, homeowners insurance, and house depreciation. You ix COPYRIGHTED MATERIAL