Not tax or legal advice. This guide is educational. It is not a substitute for
IRS Publication 587,
Form 8829 instructions,
Georgia DECAL rules, or advice from a CPA, Enrolled Agent, or attorney. Rules and rates change. Confirm everything for your facts and tax year.
See also our full disclaimer.
How to use this checklist
Print it or copy it into a notes app. For each item, ask: Was this ordinary and necessary for my daycare business? and Do I have a receipt, statement, or log? Home expenses usually need a business-use percentage (often the daycare Time-Space %). Personal costs are not business deductions.
Income side (don’t skip)
- Tuition / parent payments (and 1099-K or other info returns if issued)
- CACFP or other food-program reimbursements (generally taxable business income — confirm with your preparer)
- Registration fees, late fees, supply fees
- Grants or subsidies tied to your daycare business
Direct daycare expenses (often Schedule C)
These are commonly tracked as business expenses when they are for the daycare (not your household’s personal share):
- Toys, books, curriculum, and age-appropriate supplies
- Arts/crafts, paper goods used for care
- Diapers, wipes, gloves used for daycare children
- Safety gear (outlet covers, gates) used for the business
- Advertising, website, listing fees
- Liability insurance for the daycare (business policy)
- Licensing, background checks, training required for the business
- CPR/first-aid courses for providers/staff
- Payroll / contractor help (W-2 or 1099 as required)
- Accounting / tax prep fees for the business
- Bank fees on a business account
- Software or subscriptions used for the daycare
- Gifts / appreciation within deductible limits your preparer applies
Home expenses (Form 8829 territory)
Many providers allocate a portion of home costs using Time-Space % (or another allowed method). See Pub. 587 and Schedule C vs Form 8829.
- Rent or deductible mortgage interest (as allowed)
- Real estate taxes (as allowed on 8829 / Schedule A interplay — ask your pro)
- Homeowners / renters insurance (business portion)
- Utilities (electric, gas, water, trash, internet if allocable)
- Repairs and maintenance (business portion; capital improvements are different)
- HOA fees (if allocable under your facts)
- Security system monitoring (business portion)
- Depreciation of the home (regular method) — often CPA territory
Food & meals
- Choose standard meal/snack rates or actual food costs (with support) — see our meal rates guide
- Daily meal/snack counts by type for daycare children
- CACFP reimbursement totals to net correctly if you use standard rates
Vehicle & travel
- Business miles (standard mileage) or actual vehicle expenses — pick a method with your preparer
- Mileage log: date, purpose, miles (field trips, supply runs, training)
- Parking and tolls for business trips
2026 rate & admin reminders
- Meal rates: 2026 standard rates in our materials are provisional until Pub. 587 (2026) publishes — verify before filing.
- Mileage: IRS business standard mileage rates can change mid-year; track which rate applies to which dates.
- Quarterly estimates: Self-employed providers often need estimated tax payments — plan with your CPA.
- Records: Keep returns and supporting records as long as your preparer recommends (often multiple years).
Track categories in one workbook
The Daycare Tax Workbook maps expenses toward Schedule C–style and Form 8829 summaries, with editable 2025–2026 rate fields.