Last Minute Tax Saving Tips!

Quick...while there is still time.....learn how to reduce your income tax bill!

The best way to save on taxes is to have accurate records. Keep EVERYTHING related to your business finances and be sure to pass this information along to your bookkeeper or income tax preparer.

Record all of your daycare cash expenses, credit card charges, and deductions paid for with a check including parking receipts, supplies, mileage and food expenses. If you did not do this monthly, then be sure to open your checkbook register and go line by line through each entry noting business expenses on a separate sheet of paper.

Contribute as much as you can into some sort of tax deferred retirement plan such as a 401(k), IRA, SIMPLE, SEP or Keogh. This creates a great tax shelter and sets aside money for your future.

Did you perform any volunteer work for a charitable organization? If so, you can deduct from your taxable income the cost of traveling to meeting held by the organization as well as parking related costs. The IRS also allows you to deduct volunteer miles traveled in your car or the cost of a bus or taxi used to transport you on behalf of this organization.

Instead of donating your time, you could donate cash or property and claim a tax write off as well.

Be sure to take a good look at what you can include as a miscellaneous deduction on your federal tax form. Forbes magazine reports that you can include attorney fees for tax advice in connection with writing your own will, the fee charged by a broker to act as a custodian of your IRA, rental fee for a safe deposit box, tax preparation fees, and the cost of uniforms related to your job.

Many daycare providers have children of their own. If you send your own child to a daycare or preschool program you may be able to tax advantage of the Child Care Tax Credit. This allows you to deduct a portion of the expenses related to the care of your child from your tax liability.

If you children are under the age of 17, you may also qualify for the Child Tax Credit. This gives you $400.00 off from your 1998 taxes for each child that qualifies!

The deadline for filing taxes is approaching fast. Be sure to get those forms in on time in order to avoid any penalties and interest.

Brigitte A. Thompson (WAHM of Sarah 1/93 and Jacob 4/97)

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About the Author:
All articles ©Copyright 1999 Brigitte A. Thompson Brigitte is the President of DATAMASTER, LLC and has been providing accounting, bookkeeping, income tax and payroll services since 1992. She has also operated a home daycare for years and has written a book for providers :
The Home Daycare Complete Record-keeping System