Year End Tax Statements
Parents, like child care providers, want to utilize every tax deduction available to them. That means claiming their child care expenses. Caregivers are therefore required by law to provide a parent with Year End Tax Statements of fees paid for care if a parent .
Your tax statement need not be anything elaborate, but mustrequests one contain the following information:
* The complete the name of the parent
* The number of children you cared for
* The total child care amount paid during the 2002 tax year
* Your name or your business name
* Your social insurance/security number
* Your Business Identification Number if you have one
* The date
* Your signature
Hopefully, throughout the year you kept some sort of Attendance Payment Record where you recorded each child's attendance for each month, along with the amount of payment the parent made and the date payment was made. This will make tabulating your year end statements relatively simple. All you'll need to do is take the payment for each month and tabulate them for the year.
When it comes to payments for divorced or separated parents who share custody of a child, you'll most likely have to prepare one form for each parent showing only the amount that each individual parent paid. If only one parent pays for the care, you might consider giving each parent a copy of the statement just to be on the safe side.
The good news is that by preparing your Year End Tax Statements for your parents, you are calculating your earnings for the year which you'll need when you prepare your taxes. Now if you were passionate about keeping track of your expenses on a monthly basis using a Monthly Expense Statement, you're tax preparation will be a snap.