Refunding Child Care Fee

[magsgma]

I have a client that paid one month in advance. After the 2 week trial I need to term this family. I want to refund the amount that he will not be coming. How do I handle this properly? I need an answer asap. Tomorrow is their last day.

[Brooksie]

If they paid 1 month in advance and you want to term immediately (tomorrow) after their trial, then I would give them half of their payment back. I'm not sure what the question is? Have you discussed with them that they aren't working out and tomorrow will be their last day?

[daycare]

I would refund the difference that the child did not use.

I also charge monthly. However, when I start new clients, I always have them pay by the week until after the two week trial is over. I then re-evaluate the whole situation to see if I really want to move forward. I if I do, then I send an official invitation to join the child care. If not, I term. It is after that, that I will require monthly payments and a deposit.

Hope this helps some

[Leigh]

If it was a trial period, I would charge only for the services used. Outside of the trial period, I would charge the full amount agreed to in the contract.

[TomCopeland]

refund

I have a client that paid one month in advance. After the 2 week trial I need to term this family. I want to refund the amount that he will not be coming. How do I handle this properly? I need an answer asap. Tomorrow is their last day.

Since you are refusing to continue to provide care you should not charge for the days you aren't providing care. If your contract says differently, then follow what your contract says. But, it seems only fair not to charge parents for days you won't provide care.

[magsgma]

Since you are refusing to continue to provide care you should not charge for the days you aren't providing care. If your contract says differently, then follow what your contract says. But, it seems only fair not to charge parents for days you won't provide care.

Thanks Tom,
Yes I agree. I do believe that I should refund the money, and I shall...
What I need to know - since it has already been invoiced through MM at the whole amount. Should I have them return the invoice and issue a new one? How -- for tax purposes -- do I properly handle this.

[TomCopeland]

refund

Thanks Tom,
Yes I agree. I do believe that I should refund the money, and I shall...
What I need to know - since it has already been invoiced through MM at the whole amount. Should I have them return the invoice and issue a new one? How -- for tax purposes -- do I properly handle this.

Don't return the invoice. Give them a statement that says you are paying them $ as a refund on a previous payment. Report the amount you received from the parent as income. Then report the refund as a business expense under Other Expense (parent refund).

[magsgma]

Don't return the invoice. Give them a statement that says you are paying them $ as a refund on a previous payment. Report the amount you received from the parent as income. Then report the refund as a business expense under Other Expense (parent refund).

Thank You Tom!