Chapter II.

The ABCs of Record Keeping

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Comparison of Family Child Care Record Keeping Systems There are a number of record keeping systems you can use to help you organize your records. No one system is best for everyone.

Software Minute Menu Kids Pro Software (now KidKare) Description: Online software, will run on Mac and all platforms in 2016. Ability to file CACFP claims electronically with sponsor. Tracks all income and expenses. Tracks business miles, parent invoices, hours worked, and contains a series of reports that makes it easy to transfer data to the tax return. Can purchase electronic bank payment with parents. 30 day free trial. Some providers have Minute Menu without the Kids Pro accounting section. Cost: $69.85 per year (includes the accounting section) Contact: http://www.minutemenu.com/web/mmkids.html; 972-671-5211 CACFP.net Description: Online software allows providers to file CACFP claims electronically with sponsor. Record keeping features include a budget template, an online checkbook, parent invoices, in-out time tracking, income and expense reports Cost: Free. Available only through a CACFP sponsor. Contact: www.cacfpnet.com

Calendars Redleaf Calendar-Keeper Description: Desk calendar with monthly expense charts, attendance and payment logs, mileage records, meal/snack tracking chart, and contains an envelope to put receipts in. Monthly expense chart identifies expenses as seen on tax forms. Also includes monthly nutritious recipes, activities and helpful tips. Cost: $17.95 Contact: www.redleafpress.org; 800-423-8309 Forms, Facts and Figures Description: A record keeping workbook with monthly income and expense forms. Contains nutrition education pages, contact information forms, year-end parents payment summary form. Cost: $13.00

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Contact: http://www.wildwoodonline.org; 800-223-0557 Nutrition Calendar & Record Keeping System Description: Monthly income and expense record, attendance and payment record, income tax worksheet, utilities and home expenses worksheet, parent connection newsletter. Cost: Free through the Wisconsin Department of Public Instruction (608-267-9121) Contact: www.cacfp.org/marketplace1/calendar-and-record-keeping-system/

Tool Kits Child Care Tool Kit Description: A series of folders to hold your records. Folders divided into sections on Provider records, Business Income, Business Expenses, CACFP, and Children. Sample folders under Business Expenses include: Children’s Activity Expenses, Cleaning Supplies, Wages, Expenses for Business Use of Home, Time/Space Documentation, and more. Each folder has a list of records that can be included in it. Includes over 100 folders. Produced by Child Care Partnership Cost: $46 + postage (estimated total of $52) Contact: www.westerndairyland.org/ccprr/childcaretraining.phtml; 800-782-1880 Family Child Care Business Kit Description: Cardboard box contains a series of folders to hold your records. Produced by the National Association for Family Child Care. Folders divided into sections on Business Mail, Business Income, Business Expenses, Children, Resources, Food Program and Provider. Each folder has a list of records that can be included in it. Includes a users guide by Tom Copeland and four free hours on phone/email consultation with Tom Copeland. Includes 73 folders. Cost: $73.95 Contact: www.nafcc.org/Family-Child-Care-Business-Kit; 801-886-2322.

Other Online Spreadsheets Description: Providers can use a variety of online spreadsheets to help them organize their records. Providers must create their own income and expense categories to track income payments and business expenses. Cost: Free Excel Online: https://office.live.com/start/Excel.aspx# Google Sheets: www.google.com/sheets/about/ Zoho: www.zoho.com/docs/sheet.html Quickbooks Description: Online accounting software. Can set up your own income and expense categories. Not family child care specific. Cost: $200 Contact: www.quickbooks.com; 844-845-2174

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What Records Should Family Child Care Providers Keep?

Providers should be keeping records for their business for a variety of reasons. They may be necessary to prepare your taxes, defend against a tax audit or hire/fire employees, comply with a child care licensing investigation, make an insurance claim, or defend yourself against a lawsuit.

Record Keeping & Tax Records Employee payroll records Calendar notations (showing trips, work activities, etc.) Mileage records (mileage log or calendar) Monthly CACFP claim forms (including records of all non-reimbursed meals/snacks

served) Monthly bank statements – checking and saving (and check registers) Monthly credit/debit card statements Other written records created by the provider Photographs of purchases (when you have no receipt) Receipts (all business and personal receipts) Record of number of hours worked for two months when children are not present Records of income: parent payments, CACFP reimbursements, Wisconsin Shares

subsidy program, grants, and other income Tax returns (for all years you filed one)

Legal Records Incorporation/partnership paperwork Insurance policies (homeowners, business property insurance, car, business

liability, disability income, health, life) Inventory of household items

Child Care Licensing & Parent Records All records required by child care licensing Accident reports Authorization forms to administer medication Child admission/enrollment forms Children’s attendance records Child immunization records Parent contracts/policies Parent custody agreements Parent permission forms

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The Three Most Important Record Keeping Tasks Whether you are a new family child care provider or someone who has been in business for many years, these three record keeping tasks will make the biggest impact on reducing your taxes. 1) Save all receipts associated with your home This includes receipts for utilities, snow blower, cleaning supplies, furniture, welcome mat, garden hose, light bulbs, rug, paper towels, toilet paper, dehumidifier, laundry detergent, Tupperware, everything! 2) Track all the meals and snacks you serve to the children in your care If you are on the Food Program your monthly claim form contains the necessary information. But, if you are serving meals and snacks that are not reimbursed by the Food Program, it’s important to record these meals/snacks as well. Keep daily attendance records showing who ate how many non-reimbursed meals and snacks. 3) Track all the hours you work in your home You should keep daily attendance records that show when the first child arrives and the last child leaves. In addition, for two months track all the hours you do business activities in your home when daycare children are not present. These other business activities include: cleaning, meal preparation, activity preparation, record keeping, time on the Internet, parent phone calls, etc.

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Save All Receipts Associated with Your Home Family child care providers can deduct all “ordinary and necessary” expenses associated with their business. Since providers must maintain a home learning environment for children, this means there are hundreds of items around your home that are deductible. For example: Playroom: toys, rug, DVD player, furniture, children’s books, wall decorations, etc. Living room: curtains, chair, lamp, ceiling fan, couch, end table, television, etc. Bathroom: towels, soap, toilet paper, rug, bathroom scale, light bulbs, etc. Garage/basement: tools, freezer, garbage can, bicycles, lawn mower, snow blower, wheelbarrow, garden hose, washer, dryer, etc. Outdoors: rake, fence, new house siding, welcome mat, patio chairs, deck stain, etc. How long should I save my receipts? For four years after you file your federal and state tax forms. What should I do if my receipts fade? Make copies or scan them into your computer. If you scan them you do not need to save the paper receipt. What if I don’t have a receipt? IRS rules say you must have an “adequate record”, not a receipt, to claim a business expense. Other adequate records could include: cancelled check, credit/debit card statement, photograph, written note where you record key information (date/amount of item/item description/where purchased), calendar notation, etc. Should I save my personal receipts? Yes. This is because you may not realize it can be deducted until later. For example, if you bought a toy for your own child for his birthday, you might not save the receipt. But if your child played with the toy with the daycare children, it would be partly deductible. It’s easier to save all receipts, business and personal, and later sort out what is deductible at the end of the year. How do I know I’m saving all the records I should? Use the “Monthly Record Keeping Checklist” to stay on top of saving your records.

Week 1AM Cleaning PM Cleaning Email/Internet FCC Assn. CACFP Meal Parent Phone Calls Preparing Record Other Other Other

Activities Paperwork Preparation Interviews Activities Keeping

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

Total Week 1

Week 2AM Cleaning PM Cleaning Email/Internet FCC Assn. CACFP Meal Parent Phone Calls Preparing Record Other Other Other

Activities Paperwork Preparation Interviews Activities Keeping

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

Total Week 2

Week 3AM Cleaning PM Cleaning Email/Internet FCC Assn. CACFP Meal Parent Phone Calls Preparing Record Other Other

Activities Paperwork Preparation Interviews Activities Keeping

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

Total Week 3

Week 4Am Cleaning PM Cleaning Email/Internet FCC Assn. CACFP Meal Parent Phone Calls Preparing Record Other Other

Activities Paperwork Preparation Interviews Activities Keeping

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

Total Week 4

Monthly Total

Number of Hours

Track All the Meals and Snacks You Serve the Children in Your Care A Weekly Meal Form

Name of Child Monday Tuesday Wednesday Thursday Friday Saturday Sunday Totals

Brk _____ Brk _____ Brk _____ Brk _____ Brk _____ Brk _____ Brk _____ Brk ______

Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun ______

Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din ______

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Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____

Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____

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Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din ______

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Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun ______

Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din ______

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Brk _____ Brk _____ Brk _____ Brk _____ Brk _____ Brk _____ Brk _____ Brk _____

Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____ Lun _____

Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din _____ Din _____

Snk1 _____ Snk1 _____ Snk1 _____ Snk1 _____ Snk1 _____ Snk1 _____ Snk1 _____ Snk _____

Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____ Snk 2 _____

Snk3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____ Snk 3 _____

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Weekly Total: Breakfast _______ Lunch _______ Dinner _______ Snack ______

Make copies of this form for each week. If you have more than six children in a week, make an extra copy.

A larger version of this chart can be found in the Redleaf Calendar-Keeper (www.redleafpress.org) or it can be downloaded

for free from this website.

Monthly Record Keeping Checklist

January February March April May June July August September October November December

Received Parent Payments

Submitted CACFP Claim

Recorded Child Attendance

Recorded All Meals Served

Kept All Receipts

Marked Receipts as 100% or Shared1

Tracked All Hours Worked2

Recorded All Business Trips

Other

Total

Directions

At the end of each month review these record keeping tasks.

Put a checkmark in the box next to each record keeping task you completed that month.

1 Indicate for each item on a receipt whether it was used 100% for business or whether it was used for business and personal purposes (shared).

2 You need only track hours for two months each year the hours you work in your home when children are not present.