What share of your home is your day care?

Your home

Your hours

Your expenses for the year

Check the simplified rate and cap against the current IRS instructions; they are inputs because they can change. Depreciation: enter the annual figure from your own records or preparer.

Fill in your home, then click Calculate.

Result

Business share of each expense

What the hours are worth

How it is calculated

Time share: (hours per week + prep hours per week) × weeks open ÷ (24 × days available). Space share: room area ÷ home area. Rooms marked exclusive count at 100% of their area with no time factor; other rooms are multiplied by the time share. Business-use share: exclusive area share + regular area share × time share. Each indirect expense is multiplied by it. Simplified method: rate × (exclusive area + regular area × time share), capped at the area you enter.

Not modelled: depreciation itself (enter the annual figure), depreciation recapture when the home is sold, the Schedule A effect of the personal share of mortgage interest and property tax, the income limit on the deduction, state rules, licensing, food and meal reimbursements, and whether your hours and rooms would pass an examination. Unverified: tested on hand-calculated examples, not on a filed return. It computes a percentage; it does not tell you what to claim.

Common questions

What is the time-space percentage for a home day care?

It is the share of your home's expenses you can treat as business use when you run a day care from space you also live in. You multiply the share of your home's floor area that you use for the business by the share of the year's hours that the space is in business use. A 600 sq ft area used 55 hours a week for 50 weeks, in a 1,500 sq ft home, gives a space share of 40 percent and a time share of about 31 percent, so roughly 12.6 percent of indirect home costs.

Which hours count as business hours?

Hours children are in your care, plus time you spend preparing and cleaning up for the business, are the usual inclusions in the IRS publication on business use of the home. Enter them separately so you can see what each is worth. Keep a log, because hours are the figure most often questioned. Confirm what counts for your situation with a tax professional.

Do I divide by 8,760 hours?

Yes for a full non-leap year, 24 hours times 365 days. If the space was only available for part of the year, for example you moved in mid-year, enter the number of days it was available and the tool uses 24 hours times that number.

What if a room is used only for the day care?

A room used regularly and exclusively for the business is counted at 100 percent of its area with no time factor. Mark such rooms exclusive. Rooms used for the day care and also for family life use the time factor. Note the exclusive-use test is strict; a playroom the family also uses is not exclusive.

Regular method or simplified method, which is bigger?

The tool shows both on your figures. The simplified method is a flat rate per square foot of allowable area up to a cap, with no expense tracking or home depreciation; the rate and cap are inputs because they are set by the IRS and can change. For a part-time-use area the allowable area is reduced by the time share. The regular method is often larger for a home with high interest, tax, utility and depreciation costs, but it has record-keeping and depreciation consequences this tool does not model.

Does it include food and supplies?

Not in the time-space calculation, which covers indirect home expenses only. Food, toys, supplies and similar costs are direct business expenses with their own rules. You can enter a direct-expense total so it appears next to the home deduction, but it is not multiplied by anything.

Is my information uploaded?

No. The calculation runs in your browser from figures you type, nothing is sent to a server, there are no accounts, and it works offline after the page loads. No child or family information is needed or accepted.