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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

 
12 Replies
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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

Your wife self-employed and will report her business income and expenses on Schedule C. 

Please see the following links which provides helpful information for your situation:

The Home Office Deduction

Reporting Self-Employment Business Income and Deductions

How is begin Self-Employed different from being an Employee? 

Which TurboTax version do I need for a Schedule C? 

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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

There seems to be opposing information out there about how to claim the area of the house that is used for boarding/doggy day care but not exclusive. I have read that you can claim living areas used under the day care services deduction but I don't know if this is true. The way the tax books read it seems like day care use only counts for humans. Can you provide any clarification?
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Level 7

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

@nikiandmike   Yes, it only applies to humans.  So in your case, the Home Office deduction would only apply to space that is used regularly and exclusively for business.
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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

Thank you!
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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

If the yard is specifically for dogs only can that portion be considered in the total square footage of the home as part of the percentage of the home office deduction?

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Level 15

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

Sorry but no ... only space under roof count and not the land/yard.
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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

HI!! I want to jump on this subject real quick, hope you guys don't mind!

 

So, is the answer that: we can't have a dog or cat daycare and be able to claim it as a business?

OR

just that we can't claim the use of our homes for the care. 

 

I do kitten rescue/fostering/"babysitting" for others AND I charge and ave a lot of expenses such as food, toys, furniture and medications NOT paid for by owners or rescues. Plus, My WHOLE  house is a daycare! 😄 

 

Can I not claim this as a business? Because t is as is the individual with a doggy daycare I believe.

 

and if not, can we just say "daycare" and be non specific and claim or honest costs and deductions without having to SAY what we care for? 

 

Thank you!!

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Level 15

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?


@KittyMama wrote:

HI!! I want to jump on this subject real quick, hope you guys don't mind!

 

So, is the answer that: we can't have a dog or cat daycare and be able to claim it as a business?

OR

just that we can't claim the use of our homes for the care. 

 

I do kitten rescue/fostering/"babysitting" for others AND I charge and ave a lot of expenses such as food, toys, furniture and medications NOT paid for by owners or rescues. Plus, My WHOLE  house is a daycare! 😄 

 

Can I not claim this as a business? Because t is as is the individual with a doggy daycare I believe.

 

and if not, can we just say "daycare" and be non specific and claim or honest costs and deductions without having to SAY what we care for? 

 

Thank you!!


You can have the daycare of the animals as a business.  And you can claim the portion of your home  for the daycare facility.  You just cannot claim any of the grounds outside of the home for depreciation or the square footage used for the business.

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Level 15

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?


@KittyMama wrote:

HI!! I want to jump on this subject real quick, hope you guys don't mind!

 

So, is the answer that: we can't have a dog or cat daycare and be able to claim it as a business?

OR

just that we can't claim the use of our homes for the care. 

 

I do kitten rescue/fostering/"babysitting" for others AND I charge and ave a lot of expenses such as food, toys, furniture and medications NOT paid for by owners or rescues. Plus, My WHOLE  house is a daycare! 😄 

 

Can I not claim this as a business? Because t is as is the individual with a doggy daycare I believe.

 

and if not, can we just say "daycare" and be non specific and claim or honest costs and deductions without having to SAY what we care for? 

 

Thank you!!


Of course you have a business.  Any time you provide goods or services in return for compensation  (any kind of compensation, including money, barter, or other things) you would be considered self-employed and you must report all your business income and you can deduct your "ordinary and necessary" business expenses.

 

The specific issue here is the "home office" deduction, or "business use of the home."  

 

More generally, the problem is how to deduct expenses that are shared between a business and a personal expense.  You can't deduct a personal expense on your business.  There are a lot of specific details involved there.  For example, if you provide the same food to your personal pets and your rescue or foster animals, you can't deduct the food as a business expense unless you have some reasonable way of allocating the cost between personal and business.  (Naturally, if you keep the food supplies separate, you can deduct all the food supplies used for the business.)

 

Business use of the home follows special rules because a home is a personal expense.  You can only deduct business use of your home if the home is your regular place of business, and if you set aside an area of your home that is used exclusively for business and never for personal use.  Then, you can deduct a percentage of your home expenses (insurance, utilities, and so on) as a work expense.  If you were a contractor for example, and used a spare bedroom as your office where you sent bills, made appointments, wrote out permit applications and so on, and did not use the bedroom for personal living space, then you can use the home office deduction.  But if you did your administrative work at the kitchen table, you can't take the home office deduction.   Or if you use half the basement exclusively to store inventory.  And so on. 

 

Then, there is a special rule if you are a home childcare provider.  You can deduct part of your household expenses as a business expense if you provide childcare in your home, even though you don't use your home exclusively for your childcare business.  This special rule only applies to human child care, not animal day care. 

 

So for pet rescue, pet-sitting, boarding, and so on, it is certainly a business and you can deduct allowable business expenses, but your regular household expenses are not allowable business expenses unless you use part of the house exclusively for pet-sitting and no other purpose.  Even if you use the yard exclusively, there's nothing you can deduct there because the business use of home rule is based on square footage of structures, not land.  (However, if you had a shed in the backyard where you kept your supplies, or kennels that were "Structures" permanently attached to the land, then those structures would allow you to claim a partial home office deduction if they were used exclusively for work)

 

On top of all of this, there is the simplified vs complicated home office deduction we could talk about, but first you have to show you qualify for any home office deduction in your particular situation. 

*Answers are correct to the best of my ability but do not constitute legal or tax advice.*
**If a post answers your question, choose it by clicking on "Mark as Best Answer".**
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New Member

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

Thank  you!

 

I DO have a room exclusively for the cats, but do not separate the food and such except by age/type so thank you much! for the clarification and answer. ( The above person too, thank you!)

 

I will then do business and just count the room and forego the food expenses since they are not separated 😕 A Note for next year, right! :(

 

Have a lovely day guys!

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Level 3

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?

 

There are three common tests for deductibility of business expenses:

  1. Ordinary and Necessary - The expense must be ordinary and necessary. Generally, this means that the expense is commonly found in the specific business, and is helpful and appropriate in running the business.
  2. Business Purpose - Expenses must have a legitimate business purpose to be considered deductible.
  3. Reasonableness - The tax law requires that the deductions be reasonable to be deducted.

 The resources below are useful for understanding common business deductions.

 

Taking Business Tax Deductions

 

What self-employed expenses can I deduct?

 

Business Use of Vehicles

 

The Home Office Deduction

 

IRS Publication 535

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Level 15

My wife is running a dog-daycare from home. We mainly use our living, family-rooms and back yard for the business. What can I claim in our tax returns?


@KittyMama wrote:

Thank  you!

 

I DO have a room exclusively for the cats, but do not separate the food and such except by age/type so thank you much! for the clarification and answer. ( The above person too, thank you!)

 

I will then do business and just count the room and forego the food expenses since they are not separated 😕 A Note for next year, right! :(

 

Have a lovely day guys!


You could still deduct food but you must keep some kind of reasonable record to show the IRS your method for determining how much food was a business expense.  For example, if you have two cats of your own, and you have a calendar showing that the average number of cats you sit for each day is 3, then you could deduct 3/5 the food cost.  

 

Mixing work and personal expenses does not automatically make the expense not deductible, but it increases your burden of proof should the IRS audit you.  It's much less record keeping to have separate food, although if all the animals share the same living space, I guess you never know who is eating out of which bowl.

*Answers are correct to the best of my ability but do not constitute legal or tax advice.*
**If a post answers your question, choose it by clicking on "Mark as Best Answer".**