The insurance you need in putting up a day care center

by admin on July 29, 2009

Getting insurance is not easy. Besides from growing expenses now days, people do not get why they have to pay for something that you may never even use. But then again availing of the insurance program can be a good prevention of a higher cost. Well, you can really never tell. So be might as well prepared.

As a new business owner, you may encounter a lot of problems starting up. New challenges may arise daily in your day care center. It is therefore a must that your business be protected from risk or any liability. It can keep you worry-free as a business owner. The insurance you can get can cover everything from child injury to damage of property. It’s better to have protection before any of these things happen.

In being a day care center owner, there are different kinds of insurance that you need to avail. Here is a list of the insurance that you may consider being a day care operator.

1. Business Insurance. Your day care center is a business, after all. Business insurance protects you from greater losses in the future. It protects your current and future employees, as well. Having your business insured will protect you and your investments in the long run.

2. Accident, fire and other basic insurance. These kinds of insurance protect your home or business place. Some insurance agencies include this in basic business packages together with other special types of insurance.

3. Childcare liability Insurance. The insurance company may include this in the business insurance but some have a separate insurance for this. Furthermore, there are different types you can get depending on the kind of day care that you run. Try shopping around to get the best insurance suited to your business. This kind of insurance cover injury, legal costs and even losses. Day care liability insurance, however, is not the same for home day care and commercial day care centers. Inquire your insurance agency now for you to get the best deal there is.

4. Insurance for Omissions and Errors. This kind of insurance gives the maximum coverage for the day care center you own. It covers personal injury, negligence, field trips and unforeseen circumstances. You can get $50,000-$100,000 for medical expenses of the kids due to accidents and even accidental death.

Always remember that it’s best you have everything insured. Even the simple things such as auto insurance may be very beneficial to you in the future. Canvass around different insurance providers and inquire about the different business package deals and the important documents you have to submit. Each type of insurance has a different set of requirement and may also depend on where you are located. Getting this protection will ensure your stay in the business no matter what. So why think twice about getting coverage? It can be more beneficial than you can actually imagine!

Less Taxes for Home day Care Center
Instead of leasing or renting a business space, why not run your day care center in your own house? If you have been babysitting your friends’ and relatives’ kids and you’re very fond of being with kids, why not consider setting up your own home day care business? Aside from doing the things you love, you’ll be able to earn money too. The home day care business enjoys a lot of tax deductions as well. Here are some tips on how to avail of those deductions by meeting the IRS requirements.

1. The day care center you own must take care of clients.

2. You must’ve met all the requirements set by your state which then entitles you to a license.

3. Using your own house as your business place has benefits that you can actually use. Here is how you can have the tax deductions.

The portion of the house you will be using for your business can have tax deductions. A formula in getting the deduction is stated below.
% used for daycare: the total area of your house you use for the day care over the total area of your house

If your business operation is from 9 am to 5 pm, the following formula can be used to know how much daily are your business hours.

Total hours for day care: number of business hours
8760 hours, 8764 during leap years

Then you use the formula below to get the amount of your tax deductions

Tax deduction = the total income in your household x % used for daycare

By doing the simple math, you can avail of the tax deductions for your home business.

Also, you can deduct the food and other consumables. Keep your receipts to know what items you must declare and to save some expenses. Anything that you use is considered consumable: toilet paper, microfiber diapers, laundry soap and even table napkins as long as you use the items for business purposes. Just multiply the expenses with the formula above.

There is also a deduction for utilities and supplies. Having children means higher consumption of electricity and water. Electricity and water are services you used for business and thus can be declared. Simply multiply the total expenses in a year with the formula above. If the line is intentionally installed for business purposes, it can actually be fully deducted.

Then, you can still declare the work made on home services. Any remodeling or renovation made for purposely for business can be a tax deduction. Keep the receipts you have for house repair or even simple things such as plumbing and cleaning.

This is only one of the many advantages of having your day care center operated at home. It gets you to pay less tax. All you need is the knowledge about your rights as a home business owner. Just spend a little time in calculating when the taxes come and you’ll be rewarded and relieved of incoming problems. Remember to keep all the receipts from any purchases. This little hassle can give you so much in the end!

See: How to start a daycare center

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Tom Shieh has written 323 post in this blog.

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