Home daycare books, by someone who reads §280A.
Time-space percentage calculated correctly. CACFP food-program reimbursements reconciled. Home expenses allocated by formula, not by feel. Built for licensed home and center providers.
Time-space percentage computed wrong is the single biggest source of audit adjustments in this niche. CACFP reimbursements not handled correctly are either over-reported (more tax) or under-reported (a CP2000 letter). Generic preparers virtually never get this right.
How we fix it.
Time-space calc
Hours of care + hours of prep / total hours in the year × business-use square footage / total square footage. We document by month, with a record that holds up.
CACFP reconciliation
Food-program reimbursements parsed by tier and meal type. Reimbursable vs. non-reimbursable food cost tracked.
Home-business expense allocation
Utilities, depreciation, mortgage interest, insurance, repairs — each allocated by time-space, not flat 50%.
Annual return
1040 + Sch C, Form 8829 (business use of home), Form 4562 for any depreciation. State filings as required.
Why us for childcare providers.
IRS Enrolled Agent, enrolled to represent taxpayers before the IRS in all 50 states, alongside CPAs and attorneys.
Finance training: the math behind every recommendation we make. Currently in law school.
Time-space percentage — by formula, with documentation.
The IRS rule is (hours used for business / total hours in year) × (square feet used for business / total square feet). Most home daycare providers either guess or use flat 50%. We compute properly and back it up.
CACFP reimbursements — reported correctly.
Tier-1 and Tier-2 reimbursements are reported as gross income; the actual food cost is deductible. Reporting net is the common error and produces audit adjustments years later.
Depreciation on the home — useful, but with a sting.
A home daycare can depreciate the business-use percentage of the home — but you owe recapture tax on that depreciation when you sell. We model whether the deduction beats the eventual recapture (usually yes, with a plan).
Pricing, on the page.
Published prices · Quoted in writing before any work startsHow it works: one annual fee, half paid at engagement and half before your return is filed. Everything past the package baseline is a published add-on at a fixed price, so nobody counts forms. Books, payroll and sales tax are the only monthly items, because they are the only monthly work. See the full grid and every add-on or get your price in a minute.
One practitioner. Every file, personally led.
Cody is an IRS Enrolled Agent with an MBA — a solo practitioner with a small support team, working out of Lakeland, Florida. He is also currently in law school.
Every client engagement is led by Cody personally. The firm stays deliberately small so the work stays deliberately careful — and so when the IRS calls, the person who picks up is the person who filed your return.
Common questions.
If yours isn't here, ask it on the intake — we read every one before the first call.
How do I calculate time-space?
(Hours of business use in the year / 8,760 hours in the year) × (square feet of business-use space / total square feet of the home). We do it.
Does prep time count?
Yes. Cleanup, planning, food prep, paperwork — all count toward "hours of business use" if documented.
CACFP reimbursements — how do I report them?
Gross reimbursements as Sch C income; actual food costs as a deduction. Reporting net reimbursements is the audit-trigger error.
Can I deduct my whole house?
No — only the business-use percentage by time-space. Common areas (living room, kitchen) used during care count proportionally; private bedrooms used only by family don't count.
Depreciation recapture when I sell?
You'll owe tax on the depreciation taken when you sell. Usually it's still worth taking the deduction (deferral is a benefit), but we plan around it.
Center vs. home?
Different tax treatment. Centers are typically S-Corps with payroll; home daycare is Sch C with §280A allocation. We do both.
Related
The kids run the day. We run the time-space.
Send last year's return, your CACFP reimbursement summary, and your home square footage. We'll confirm the package on the first call.