What’s New for This Tax Year
New IRS Safe Harbor Rule
Beginning in 2013, providers can now choose to claim house expenses without any
receipts on Schedule C (up to a limit of $1,500), or they can continue to claim their actual
expenses on Form 8829. See page 9.
Standard Meal Allowance Rate
The standard meal allowance rates for 2013 are $1.27 for breakfast, $2.38 for lunch and
supper, and $0.71 for snack. The rates are higher for Alaska and Hawaii.
Standard Mileage Rate
The standard mileage rate for 2013 is $0.565 per business mile.
The 50% Bonus Depreciation Rule
Providers who buy certain new items in 2013 may be eligible to use the 50% bonus
depreciation rule. This rule lets providers deduct 50% of the business portion of the fol-
lowing new items:
• computers and office equipment
furniture and appliances
fences and driveways
cars Purchases of a home, home improvements, and used items do not qualify. The item
must be purchased new in calendar year 2013 and used in your business in 2013.
The Saver’s Credit
Low-income providers may be eligible to receive a tax credit for making a contribution
to a retirement plan in 2013. This credit is in addition to the regular tax benefit received
for making an IRA contribution. To be eligible for the credit, a provider must have an
adjusted gross income of less than $59,000 if married and filing jointly, $29,500 if single
or married and filing separately, or $44,250 if filing as head of household.
For more information on tax changes, see the Family Child Care 2013 Tax Workbook
and Organizer. For copies of all IRS tax forms and instructions, go to www.irs.gov.
viii COPYRIGHTED MATERIAL