Why Record Cleaning Hours?
Family child care providers spend a lot of time cleaning their home.
You clean each morning before the children arrive and clean each evening after the children leave. You probably also clean during some evenings and on most weekends.
Keeping careful track of all of these hours will help you significantly reduce your taxes.
This is because each additional hour you spend cleaning your home will raise your Time-Space Percentage, which will raise your business deductions, which will then lower your taxes.
In fact, time spent on any business activity when children are not present in your home (planning, record keeping, meal preparation, and so on), also will increase your Time-Space Percentage.
See my article “The Single Most Important Thing You Can Do to Reduce Your Taxes.” (http://tinyurl.com/o9dbqnk)
Because cleaning hours usually represent the most time you spend on business activities when children are not present, I want to explain in more detail the proper way to document these hours.
An Example of What You Might Do
Let’s say you care for children from 6am to 5pm, Monday through Friday. Each morning you get ready for the children and clean from 5:30am-6:00am. Each evening you clean up after the children leave from 5:00pm-5:30pm.
How should you record these hours to be able to count them on your tax return and withstand the scrutiny of an IRS audit?
If you don’t write down the hours you spent cleaning and simply add 5 hours a week to your Time Percent calculation, you run the risk of the IRS not accepting these hours without further proof.
The IRS may also not accept your short written statement that you worked “five hours a week cleaning.”
The Proper Way to Record Cleaning Hours
Write down enough details to show exactly what you were doing while cleaning. Put down the time of day you do your cleaning, so the IRS can see that it’s not being done when children are present. You want the IRS to see why it takes you a half hour in the morning to clean.
For example, you might record: “Cleaning, Monday, 5:30-6:00am: sweep front hallway and front steps; vacuum living room, dining room, and playroom; mop kitchen floor; clean kitchen countertops; take out toys from basement storage and put in playroom; fill dishwasher; do a load of laundry; wipe off tables and chairs in playroom; and clean downstairs bathroom (scrub toilet, mop floor, clean sink, wipe down surfaces and mirror, put out new towels from dryer).”
If your write down this level of detail you shouldn’t be challenged on the hours you claim. The more details you can record, the better.
I strongly recommend that providers record at least two months of careful record keeping showing all the business activities you are doing. If you conduct the same cleaning activities Monday-Friday, you only need to record this detail once. Then for these two months you would record “5:30-6:00am cleaning” and “5:30-6:00pm cleaning) for Monday-Friday on a calendar. Be sure to track any cleaning hours you do in the evenings and on weekends.
Exception to Your Normal Routine?
There may be times when you have special circumstances where you spend extra time cleaning. This could be doing spring cleaning, cleaning out the basement or garage, cleaning up after a special event, etc. If so, keep records of these hours and add them to your total hours of cleaning.
For example, if you averaged 40 hours of cleaning for two months and 20 hours of extra cleaning for the year, your total cleaning hours would be 500 hours (40 hours a month x 12 months = 480 hours + 20 hours = 500 hours).
You can’t count all of the time you spend cleaning your home in your Time-Space Percentage calculation. Some of the cleaning time is for your own family. Therefore, you should also record for at least two months how much time you spend (and when) you do personal cleaning.
For example, if you worked two hours on Saturday morning cleaning, you might record it as follows: “Saturday, 7am-9am: clean downstairs and upstairs bathrooms (scrub toilet, mop floor, clean sink, wipe down surfaces and mirror, put out new towels from dryer); make bed, vacuum floor and pick up in master bedroom; clean kitchen (do a load of dishes, clean out refrigerator, clean off and wipe down countertops, mop floor, put away dishware, clean sink); vacuum living room, playroom and dining room; take out garbage and recycling; sweep front steps and deck. One hour personal cleaning and one hour business cleaning.”
I can’t stress enough how important it is to record this level of detail when tracking your cleaning hours. For example, every one and a half hours of cleaning work you do in a week will increase your Time percent by one percent. That’s a lot when applied to all of your house expenses (property tax, mortgage interest, house insurance, utilities, house repairs, and house depreciation).
For users of the Minute Menu Kids Pro software I’ve posted an instructional video on how to record your hours you are working when children are not present here: http://www.tomcopelandblog.com/2013/11/how-to-track-hours-using-minute-menu-kids-pro.html.
Join The Child Care Business Partnership!
Minute Menu and Tom Copeland have teamed up to offer you the chance to reduce your taxes, receive direct assistance if you are audited, and personalized business advice so you can be more successful. For $15 a year you can join The Child Care Business Partnership and start receiving direct help from Tom Copeland in using Minute Menu Kids Pro. For more information: http://www.tomcopelandblog.com/2013/07/the-child-care-business-partnership-tom-copeland-minute-menu-and-you.html, or email Tom at email@example.com.