Tax FAQ

"I have one phone line coming into my house, but I use it all the time for daycare purposes. Can I deduct my phone bill as a business expense?"

Sorry, but the answer to this one is no. The IRS is very clear about not allowing anyone to write off the cost of the only phone line into your home, even if it is mostly used for your home business.

You can write off the full cost of any long distance calls you make related to your daycare business as well as the cost of any extra telephone services you add to your phone line due to your business such as Call Waiting.

If you decide to add a second phone line into your home to be used exclusively for your daycare business, you can deduct the full cost of this service as a business expense.

Great question!!! I know that when I was caring for infants, it seemed like I was always wearing spit up and after every craft project with the toddlers, I was covered with glue, paint, and glitter! It would be great to write off the cost of all those ruined clothes, but the IRS has strict rules about uniforms and I'm afraid most of us would not qualify for the deduction.

Straight out of IRS Publication 17, "You can deduct the cost of uniforms only if you wear them as a condition of your employment and they are not suitable for everyday wear. To qualify for this deduction, both conditions must be met. It is not enough that you wear distinctive clothing, the clothing must be specifically required by your employer. Nor is it enough that you do not in fact wear your work clothes away from work; the clothing must not be suitable for taking the place of your regular clothing."

The publication goes on to state that potential qualifying uniforms are those worn by fire fighters, law enforcement officers, letter carriers, and delivery drivers.

Still looking for a way to write off some clothes? I have a tax tip to share with you! Purchase a few T-shirts and have your business name embroidered on them. Then, you are advertising your business and advertising is a business deduction.

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