Guide · 6 min read
Parent payments, food program, toys, supplies, and Time-Space % — the family child care money system.
Family child care has the most complex deduction rules of any home business — and most providers miss thousands. Time-Space %, CACFP food, shared toys, utility splits, mileage to the store and field trips. Clean books typically save providers $3,000–$7,000 a year in tax.
All parent payments in one account. One card for groceries, supplies, toys, cleaning. Auto-categorize monthly.
Log daycare hours daily — including prep, cleanup, and weekend planning. End of year you'll have an audit-proof Time-Space percentage.
Breakfast, lunch, snack, dinner each have set deduction rates. Way simpler than tracking every grocery receipt and usually larger.
Save 20–25% of net for tax. Pay quarterly. Issue parent statements in January so they can claim the Child & Dependent Care credit.
SnapBooks tracks every parent payment, supply receipt, and meal — and helps you nail Time-Space % at year-end.
Start freeYes. Family child care providers file Schedule C. You owe self-employment tax (15.3%) on net earnings above $400, plus income tax.
It's the IRS formula for what % of your home costs you can deduct. Hours used for daycare ÷ total hours in the year, multiplied by % of home space used. Often 30–45% for full-time providers.
Yes — either actual costs (track every receipt) or the CACFP/Tier rates set by the USDA. Most providers use the standard meal rate; it's simpler and usually larger.
100% deductible if used only for daycare. Shared with your own kids — apply your Time-Space Percentage. Big items (swing sets, climbing frames) can be expensed under Section 179.
Not legally, but yes for sanity. Parents' payments in, supply purchases out — one account makes year-end tax 10x easier.