Need Advise

[MommyofThree]

Ok so I have one full time family. A little boy who is here from 8-5 and his sister who is here from 330-5 {after school only}. Then I have two boys who are here on school breaks and before and after school. The full time family is only 150 wk the boys are 100 wk, their brothers.Then a little girl who is here well hers very because to works at a fast food place. Then two siblings who is here every other week because the fathers a loser and dont want to pay me his week. urg.

So my dilemma, Im not on the books but now I want to be. Should I charge them more???? Plus I want to get payed holidays but afraid to make a contract. I m in the process of becoming reg. And I want the father to hold their kids spot but I know he wont. I need to be on the books because It seems like I haven't had a job in 5 years. Plus they can claim. So should I raise the rates, get payed for holidays and a weekly rate not a daily? Also how hard is it to file taxes. I know this is confusing but please. Im at a lost. Parents walk all over me. It will not go into effect till Jan 1st. Thanks. Im scared they will leave and I can't afford for them to go.

[MommyofThree]

Also my credit is being effected by not being on the books because I have credit cards (not behind, actually payedoff) but the credit card places think that im high risk because I have no income coming in:{

[small_steps]

I would charge close to what is stadard in your area. I'm a licensed home daycare and I'm very competitive to the surrounding home daycares and center daycares in my area. If you are charging less than most of them, then yes I would do a rate change at the same time as my contract change. I would require dad to continue the children's care because this is your income and you have to be able to count on it every week not every other week. Also, I might would run an ad or advertise however is best for your area to have a few more kids available if your parents decide they don't like your new contract. Its hard to stand up to parents. I do not like confrontation but sometimes it just has to be done. Good luck with however you go about this.

[laundrymom]

I don't understand what you mean " on the books". Are you saying you haven't paid taxes? For 5 years? I don't see what that has to do with raising rates. ? I'm surprised noone has claimed you anyway. Is that something they agree to at sign up? I highly urge you to always claim your income. I know taxes **** and that it's expensive but it's how we pay for so many things. It's not fair not to claim.

[laundrymom]

Also it's not hard. My advice is to go to redleaf press and look through the resources. I personally use the calendar keeper, the record guide and tax guide
and the business turbotax online.

[beachgrl]

Also it's not hard. My advice is to go to redleaf press and look through the resources. I personally use the calendar keeper, the record guide and tax guide
and the business turbotax online.

So laundrymom, do you just keep track of your income in the calendar and then pay taxes once per year at tax time or do you set aside a certain amount of your income in anticipation of the total taxes you will need to pay. I am wondering about all this too as we get closer to the start of the year. I have been keeping track of all parent's payments in an excel type worksheet for both the kids I have, the income is varying every week right now so it's not a set amount each week.

[MommyofThree]

I don't understand what you mean " on the books". Are you saying you haven't paid taxes? For 5 years? I don't see what that has to do with raising rates. ? I'm surprised noone has claimed you anyway. Is that something they agree to at sign up? I highly urge you to always claim your income. I know taxes **** and that it's expensive but it's how we pay for so many things. It's not fair not to claim.

No I have not I never knew how and everyone said that if I make less then so and so a year I dont have to claim. But I spoke with a tax guy and he says I do. no parents claim me becuse thats how its set up but would like to start and raise rates.

[beachgrl]

Melissa,

I know it can be hard to stand up to parents...I did just that last night with a parent who I really like and have never had any issues with on letting them know i would be only doing ft or pt weekly rate care when they have been doing drop in the whole time (the drop in was only supposed to be until I got enrollment up and I am starting to get more kids now so I do not want to worry with doing drop in and having random income from them every week when they have access to the whole week. She tried to make me think I had not told her that and that the reason she picked me was bc I would do drop in...yes, temporarily with ft children having priority....confirmed that I did actually tell her what I thought I had originally by my hubby who was home and heard the whole convo on her first visit)

We had a discussion and now both my current drop in families have the notice of the change and my rates as well as my newly done ft and pt contracts so they can make their decisions accordingly. I may lose one or both of them and it has my nerves a little crazy but I am just trying to remain faithful that others will come if I do. I have started getting a lot of interst lately so I am glad that I did stand up for myself and what I need to do.

I would say definitely make a contract that you have to protect yourself and your families so that you have a clear legal contract for your business. I am working on looking at tax stuff now too as I will have at least one consistent weekly income coming in although that won't be much until I get others.

[momma2girls]

Since it is so close to the New Year- I would draw up a contract on exactly everything you would like in it. Then hand it out in Dec. saying it needs to be back in time for the NEw Year.

[Nellie]

Sense you don't seem to know anything about taxes I'd suggest seeing a tax accountant. One visit won't cost much and they will explain to what receipts you will need to save for taxes, what kind of deductions you will get. You pay your taxes when you file you regular income taxes once a year. You will probable pay much less that what you are thinking you will pay in especially if you are small time. I'm going to give you a little example. Say I make 8000 though out the year. I pay 2000 feeding the kids, 500 dollars in art supplies,800 in new toys and equipment used for the daycare, 700 in cleaning supplies used to clean the house for the daycare, 200 in birthday and Christmas gifts for DCK's, 200 in curriculum, 200 for field trips, and 400 in baby wipes. Right there your income is down to 3000. Then you will get to deduct a certain percentage of all of your utility bill(electric, heat, water, and phone), You will get a mileage deduction on the vehicle you use for daycare purposes(Keep track of the miles used on your vehicle for daycare trip(pick up, dropping kids off at school, buy groceries supplies for day care, field trips) ), you will get to deduct a certain percentage of your morgage interest, house insurance, and maybe property taxes, and you will be able to depreciate the value of a portion of your home if you want. That is all that I can come up off the top of my head. By the time you take most of the deductions you income would be very little to maybe in the negative. If you have a positive number you will have to pay 15 something % in S.S. and FICA tax. The rest of the taxes you pay would be just like if you had a regular job depending on what income bracket you fall under ect. I am small time I only watch 2 kids and I'm in the negative every year. Talk to a tax accountant and they would be able to probable let you know how much you need to be setting aside. Also if you have tax return coming to you because of what is taken out of your spouse payroll taxes they take out the S.S and FICA right out of it.

[MommyofThree]

Sense you don't seem to know anything about taxes I'd suggest seeing a tax accountant. One visit won't cost much and they will explain to what receipts you will need to save for taxes, what kind of deductions you will get. You pay your taxes when you file you regular income taxes once a year. You will probable pay much less that what you are thinking you will pay in especially if you are small time. I'm going to give you a little example. Say I make 8000 though out the year. I pay 2000 feeding the kids, 500 dollars in art supplies,800 in new toys and equipment used for the daycare, 700 in cleaning supplies used to clean the house for the daycare, 200 in birthday and Christmas gifts for DCK's, 200 in curriculum, 200 for field trips, and 400 in baby wipes. Right there your income is down to 3000. Then you will get to deduct a certain percentage of all of your utility bill(electric, heat, water, and phone), You will get a mileage deduction on the vehicle you use for daycare purposes(Keep track of the miles used on your vehicle for daycare trip(pick up, dropping kids off at school, buy groceries supplies for day care, field trips) ), you will get to deduct a certain percentage of your morgage interest, house insurance, and maybe property taxes, and you will be able to depreciate the value of a portion of your home if you want. That is all that I can come up off the top of my head. By the time you take most of the deductions you income would be very little to maybe in the negative. If you have a positive number you will have to pay 15 something % in S.S. and FICA tax. The rest of the taxes you pay would be just like if you had a regular job depending on what income bracket you fall under ect. I am small time I only watch 2 kids and I'm in the negative every year. Talk to a tax accountant and they would be able to probable let you know how much you need to be setting aside. Also if you have tax return coming to you because of what is taken out of your spouse payroll taxes they take out the S.S and FICA right out of it.

great you helped alot. Now since you fall in the neg. Do you get money back every year?

[laundrymom]

I keep every reciept. Every single one. Personal & business. Even when dh gets soda in mornings. I use the calendar keeper and enter everything daily. It makes it so much easier in the spring. I keep 20% of everything I make to pay taxes it goes into a savings acct for it. I also take $5 per week per child and that goes to a seperate acct. I use it to pay myself on my vacation week. Is wear by toms books. Good luck!! If you need help ask here You will get help from everyone here. Good luck.

[Nellie]

great you helped alot. Now since you fall in the neg. Do you get money back every year?

Some years we have, some years we haven't. It all depends on how much money my husband makes. If we were going to get a return anyways we got one. If we weren't going to get one it made no difference(when you run in the negative) Now he is self employed too and making more than when he was employed we have had to pay in. We have 3 kids so a small portion of it is actual federal and state tax, but the Medicare and FICA tax(15%) is the biggest portion. This year I've made more than I have previously so I have a feeling that the daycare will make some kind of a profit. We stick 25% of everything we make in a savings account for taxes.

Do stick a percentage in a savings account. The first year I did daycare I stuck 20% away. Then it turned out I didn't owe anything so I just left that money sit in the savings and I didn't need to take 20% of the first 7000. Even if you only are in the positive by 3 or 4 thousand you will still need to pay 15% FICA and Medicare on it. That doesn't change at all wether as a family you make a little 30 to 40 thousand or 80 to 90 thousand. With State and Federal you will pay more taxes on that amount if you make 90 grand a year vs 30.
Laundrymom stated save every receipt and you should. You also will need to keep a record of the days and hours each child was in your care. In 2010 the federal government gave these rates as the standard deduction for meals $1.19 for each breakfast
$2.21 for each lunch or supper
$0.66 for each snack (up to 3 per day
If you don't use them and you use the actual cost of food spent, you need to have every receipt for daycare and home groceries. If you get audited they need to make sure that you aren't writing off every grocery that was brought into the home. I spend more that this per snack/meal so I use actual groceries.
This is only my fourth year. I have always done are personal taxes myself and have done daycare and my husbands business with the help of turbo tax. I think I'm going to go to a professional this year because after talking to another provider in town I think I have been missing deductions.