Tips For Getting Your Childcare Center Ready for Tax Season

The hustle and bustle of tax season can be particularly stressful —especially for child care providers. If you haven’t already started preparing your paperwork, now is the time to start. Read on to learn how you can ensure your childcare center has all of its financial documents in order by tax season so that you don’t have any last-minute surprises!

 

Schedule Time In Your Calendar To Work on Taxes

If you get your taxes in order, it will help you run your business smoothly, improve your decision making, and provide some peace of mind. Block off as much time as possible during tax season so that you can get all of the work done ahead of time.

 

Organize Childcare Center Financial Documents

There are many types of financial documents you should be aware of before tax season. Do not stress, the following is a list of what you’ll need.

  • Tax returns (both federal and state)
  • Business income and expense statements
  • Payroll records
  • Bank accounts (if they are separate from your personal accounts)

 

Once you’ve gathered all the necessary documents, make sure they’re organized in a way that makes sense for your business.

 

Gather Childcare Center Financial Data

The key is keeping track of your expenses and income throughout the year so you put together a tax return without having to do much math or research. Try not to wait until the last minute before getting all your documents organized; if something comes up later in the season that prevents completion by then, that could mean lost money or penalties from the IRS! 

 

Organize Receipts

It can be hard to keep receipts organized and in order, so here are some tips for making sure you don’t lose any important information:

  • Keep receipts in a folder or box
  • Scan receipts as soon as possible
  • Store scanned copies on the cloud

 

Prepare Year-end Statements For Parents

Childcare providers need to be prepared to issue customers detailed year-end statements that include all of their charges, along with how their money was spent.

 

Appoint An Accountant

The idea of hiring a professional can be intimidating, but it doesn’t have to be! Your accountant will help you find all the deductions and credits you qualify for and help with filing your taxes. And they won’t just file your taxes, they will also ensure that everything is squared away with the government so that next year’s tax season goes smoothly.

 

Use Software To Manage Accounting

With the right tools, you should spend little time documenting expenses and receivables. Childcare software simplifies this process, and can do most of the work. Instead of spending hours every tuition billing cycle, you can do a quick review before issuing bills. The system tracks outstanding payments, and helps you reduce bad debt with little time investment.

 

Schedule an iCare Software demo now to see how simple next year’s tax filing can be when you have the right tools to manage your finances.

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