COPYRIGHTED MATERIAL Part One: The Tax Organizer 41 Your Food Expenses You have two choices when calculating your food expenses. You can use the standard meal allowance rate or the actual cost of food. The standard meal allowance rate was established by the IRS so that providers could claim their food expenses without having to keep food receipts. (For a complete discussion of how to report Food Program reimburse­ ments and food expenses on Schedule C, see chapter 4. For a detailed discussion of how to track food costs, see the Record-Keeping Guide.) Here’s a summary of these two methods: Using the Standard Meal Allowance Rate You must keep the following records throughout the year: each child’s name, dates and hours of attendance, and number of meals served. If you were on the Food Program during the year, save your monthly claim forms, which contain this information. Track nonreimbursed meals on your copy of the claim form or someplace else. Use the meal form to track nonreimbursed meals for last year (or all meals if you weren’t on the Food Program). Use the year-end meal tally to total your reimbursed and nonreimbursed meals for last year. Using the Actual Cost of Food There are many ways to calculate your actual food costs. One way to do this is to buy and store your business food separately from buying and storing food for your personal use. Probably the simplest and most accurate method is to estimate the average cost per child per meal and multiply that number by the number of meals and snacks served. To calculate the average cost, track the ingredients that you served for four typical menus for breakfast, lunch, supper, and snacks. Estimate the cost of the food for each menu, and divide that number by the number of children served. (For more information about how to calculate the actual cost of food, see the Record-Keeping Guide.) If You Use the Redleaf Calendar-Keeper If you tracked your food expenses each month, your yearly total will be on page 83 of your December expense report. You may also have entered your food expenses on the income tax worksheet as direct business expenses on page 85. If you haven’t estimated your business food expenses, you may want to fill out the meal form and year-end meal tally in this book to get a more accurate deduction rather than using the totals on your Redleaf Calendar-Keeper. COPYRIGHTED MATERIAL