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DOUBLE TAP TO ZOOM WITH PHONE OR TABLET Family Child Care Record-Keeping Guide discount store, and when you get home, you see that the receipt contains three items of sup- plies and six items of toys. In this case, you would put the receipt into the “toys” category. At the end of the year you can include them with the toy expenses. It doesn’t matter that some of your toys are actually supplies because all expenses get added together at the bottom of the tax form (Schedule C). Most family child care providers use the standard meal allow- ance rate (see page 38) to calculate their food expenses, and if you do this, you won’t need to save your food receipts to calculate your food expenses anymore. However, be sure to save all your receipts for nonfood items, such as paper products and kitchen supplies, that you purchased when grocery shopping. If you get a receipt from a grocery store that shows both food and nonfood items, save the receipt and put it in the nonfood category. There is a way to organize your receipts by month and still be able to easily track the cat- egory totals. Begin by marking the total for each expense category on each receipt, and then store the receipts in folders or envelopes by month. (If you have more than one category of expense on a receipt, mark the total amount for each category.) At the end of the month, add up the totals for each category and enter them on a calendar or ledger. At the end of the year, total your monthly expense amounts for each category. If an IRS auditor asks to look at your receipts for a particular month, you will have your monthly receipts stored together for easy retrieval. Some tax professionals recommend other methods of record keeping, and you may want to follow your professional’s suggestions. However, if you already have a method that you are comfortable with, don’t hesitate to tell your tax professional that you don’t want to switch. Conduct a Regular Review of Your Records Don’t throw all your receipts into a box and wait until the end of the year to sort them out. If you do this, you’ll be likely to misplace your receipts and forget to record some expenses, and it will be much more difficult to organize your records at tax time. In an audit, the appearance of your records can sometimes be as important as the records themselves, so try to keep them in a clear, well-organized fashion. It will be easier to do this if you spend a little time on it each week. It’s best to conduct a monthly review of your records to make sure that everything is in order. At the end of each month, ask yourself: • • • • • • 24 Have I recorded all payments from parents? Do I have complete attendance records? Have I recorded all the hours that I used my home for my business? Have I kept a record of all my business trips in my calendar or notebook? Have I saved all my business receipts? Do my receipts clearly identify what I bought? (If not, mark the items on the receipts.) COPYRIGHTED MATERIAL