Family Daycare Provider

A family daycare provider is any taxpayer whop provides childcare for eligible children in their own home.

• The care cannot be medical related

• Must last less than 24 hours a day

• Cannot involve a transfer of legal custody

Eligible children are minor children who receive care in the taxpayer’s home, they cannot be any of the following,

• Full or part-time residents of the taxpayer’s home

• Children of parents or guardians that are residents of the same home

• Children who receive daycare services for personal reasons of the daycare provider (if the taxpayer provides the services as a favor for a friend or family member, they do not qualify)

Meal Expenses

Taxpayer’s who qualify as a family daycare provider can use either the standard meal and snack rates or actual costs to calculate the deductible cost of food provided to eligible children in the family daycare.

If they choose to us the standard meal and snack rates for a particular tax year, they must use the rates for all deductible food costs for eligible children during that tax year.

If they use the standard meal and snack rates, they must maintain records to substantiate the computation of the total amount deducted for the cost of food provided to eligible children.

Recordkeeping: The records kept should include the name of each child, dates and hours of attendance in the daycare, and the type and quantity of meals and snacks served. 

What’s Included in the Standard Meal/Snack Rates? The standard meal and snack rates include beverages, but do no include non-food supplies used for food preparation, service, or storage, such as containers, paper products, or utensils.  These expenses can be claimed as a separate deduction on Schedule C (Form 1040).

 Where Can I Find the Meal/Snack Rates? You can find the meal and snack rates for any particular tax year on that year’s CTTS Toolkit these are available in the Tax Resources section of the Tax Support Center.

Business Use of Home Expenses

Taxpayer’s who qualify as a family daycare provider and use their own home might be able to claim a deduction for part of their home that is used for nonbusiness purposes (this is an exception as typically it must be a separate space).

To qualify for this exception the taxpayer must meet the following criteria,

• Be in the business of providing daycare to children, people 65 and older, or people who are physically or mentally unable to care for themselves

• Have applied and been granted or exempt from having a license, certification, registration, or approval as a daycare center or as a family or group daycare home under state law