You can deduct your food expenses either using the actual expenses method ($68 in your example) or the standard meal allowance method. How much will my daycare get from the childcare stabilization grant? The NJ ARP Stabilization Grants range from $30,000 to $120,000 for licensed child care centers, depending on license capacity, provider type and monthly expenses. I plan to discount the current family tuition evenly. Q: How do I pay myself for the hours I work in the weekends or after work hours? This means you will pay some additional Social Security taxes, but it also means your higher profit will potentially increase your Social Security benefits. You will report less income in this situation, but you cant deduct anything that a parent owes you. This is not a loan. Q: Are there any grants available to add on space to my home without getting a loan? A: Yes, under certain circumstances. For most providers, this would be about 30-40% in taxes. A: No. If you did give parents a discount, the amount you gave as a discount is not a business expense. Child care stabilization grants were appropriated to states in the American Rescue Plan Act (Public Law 117-2) to help stabilize the child care sector via subgrants to child care providers due to the COVID-19 pandemic. A: An employee can work fewer hours and that wont impact the grant. In other words, lets say you paid yourself $5,000 and used $2,000 for items used 100% for your business. Email Us at: providerhelp@childcaresolutionscny.org. A: Only if you already have a post-secondary degree. But, you can pay yourself first and then use the money for these items. Contributions to an IRA will not reduce your Social Security/Medicare taxes. You will only save a small amount of money on your taxes when hiring your husband. Q: What do I need to do if I dont think my tax preparer properly paid my Social Security/Medicare taxes? A: No. Is the Child Care Program Stabilization Funding taxable? See this from the AARP website. Each state, territory, and tribe may further clarify eligibility requirements, but the federal eligibility parameters indicate that licensed, registered, and legally license-exempt center-based and home-based child care providers are eligible. I thought it was seven years. Good news - Child Care Relief Funding 2022 is here! A: No. Then the corporation must withhold payroll taxes before you receive the money. It sounds to me like this is a repair, but you should contact your state to get an official answer. Q: Can I deduct the business portion of any item in one year regardless of the cost? How does this impact my taxes? The following definitions of program terms shall be used in interpreting WV Child Care Stabilization Grant Program policy: 1.1.1. <>/ExtGState<>/XObject<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/Annots[ 15 0 R 21 0 R 22 0 R 23 0 R 30 0 R 31 0 R 32 0 R 34 0 R 35 0 R 36 0 R 37 0 R 38 0 R 39 0 R 40 0 R 42 0 R 43 0 R 44 0 R 45 0 R 46 0 R 47 0 R 49 0 R 50 0 R 51 0 R 52 0 R 53 0 R 54 0 R 55 0 R 56 0 R 57 0 R 58 0 R 59 0 R 61 0 R 62 0 R 63 0 R 64 0 R 65 0 R 66 0 R 68 0 R 69 0 R] /MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> A: Yes, deduct your time-space% of the cost in one year. How do I figure the deductions? . This income will not be the same as your food expenses. Funds are in place so every eligible program can receive one grant per facility/site. A: I dont know. This could include fish, gerbils, rabbits, and so on. stream Q: We started adding more kitchen cabinets this summer. JaJJ+7@h&P8=?xv:jA!tOUa@J]uym@%|4YX2 |[:&= 3q;n#}Ab!72d KNOgl0q8\l0'dP!_"g8X`G6"%Wi{nP"D\-;@Oi1)+fd- JE~_X\}[.qpaidP^^C5B-qOu K=(~S`!b]Rfy(-cp1PC:t)4zPSq &A##807[uCo3./kECuzS:zRsu[G q>+hL 9EJH-E*!PPRs&-L\1%gh7XXjZ/ WHAT: The department's Early Childhood Division is using funding streams to support the health and sustainability of North Dakota's child care sector. Can I pay myself with the EIDL money? State of Hawaii Child Care Stabilization Grant Program The State of Hawaii Department of Human Services has received funds through the American Rescue Plan Act (ARPA) of 2021 to provide assistance to licensed child care providers experiencing financial hardship and child care market instability due to COVID-19. Can I use the grant money for these expenses? Report as income, the amount you received from parents. Are the One-Time Child Care Stabilization Grant funds taxable? Help is on the way! These grants are now available for eligible child care agencies in Tennessee. Q: If I start claiming Social Security before my full retirement age, does Social Security look at my gross income or net income to determine if my benefit will be reduced? Phase 4 of the Idaho Child Care Grant provides funding for child care providers in Idaho to ensure they are able to remain open and caring for children. Therefore, its not a good idea to pay your husband. A: No. Q: I understand I cant lower my employees wages, but what if the employee wants to work fewer hours? A: No! Paying yourself involves nothing more than making a record indicating this. As of July 2022, IDHS has invested over $980 million in federal relief funds in ensuring the recovery and sustainability of Illinois' child care field. We are sharing the resources below which are designed to support home-based child care providers as they prepare their taxes, including guidance for handling relief funding, including the PPP. oRT@ 66V'aNAS\u8g<05!rzf7M- (bw1RK51 wOffHg]tJ}%NaiIrIV.y3*2w@LIGFIm(IsMv You cant deduct your mortgage payment, but you can deduct your Time-Space% of mortgage loan interest and you can depreciate your home to account for mortgage principal. K.4jq%E$ZT^:D+0mdEdUW#b=C\2CQ&j,AP5JRYMHj*6v)5oI DWH Q: May I claim expenses for a vehicle I also use for personal purposes, or to claim vehicle expenses it must be used only for business purposes? For all of the above answers that were No, you can still pay yourself and then use the money for these purposes. And while many childcare providers have opened back up, its been anything but easy. Congress declared that these programs are not taxable income. The American Rescue Plan Act (ARPA) has provided resources to states to distribute stabilization grants to child care providers to ensure that child care is available to support families and businesses as the economy recovers. Can painting the house be deducted as a repair? Q: What if I paid myself with this grant and then later realize that I can use it for items used 100% for my business. If he did not, have him amend your tax return and not charge you for doing so, since it was his mistake. Yes, if you are a for-profit organization this funding is taxable. You can treat this as a repair and deduct your time-space% of this cost in one year. If you do, the amount that you lower your tuition is not tax deductible. There is not law that requires you to stay in business. Is this a home improvement or a repair? Q: I had a flood in my home. Are these expenses 100% business or time-space% deduction? Once you do that, you can then spend the money on a new roof. . A: Yes! b+hxG%YM8bjW8PePQj@Cx9]3Nl6jSx $ V}$%*Qfky.zL@)^f@H{rVKJ4@(TKjZKBa0JjDRP+fT9efu'yur B9f9xk!>m7"`TPhghw /'toK|yk.I/pI:2oK[zt#'.0+mlbxGSC! Did this change? 4 0 obj Should we spend everything that we receive with the grant? A: Count the entire room as regularly used as a daycare storage room. A: You can apply some of the grant money to cover lost revenue, but you cant deduct lost revenue as a business expense. The purpose of STABLE is to respond to the urgent need to stabilize the child care sector in Georgia. 2 0 obj Child Care Stabilization Grants The American Rescue Plan Act of 2021 (ARP Act) (Pub. / Blog / General / child care stabilization grant taxable. Example 3: Provider uses some of the grant to pay herself and some for business expenses. Step 1: Submit an OK Child Care Application Step 2: OKDHS reviews the application Step 3: OKDHS approves the application Step 4: Child care program is notified of approval via email RuH )rPG_hDR,\{@f7hfx#noL5'4+Dc"HmZtz)FNF!`\B,edxDk"~K]1XCMGb:BVLMMv/>>`sZ+`\GvLPE7TRi4}3U15rUUjx5;] i=U*'1)mhM\)$8BjQ3b!rE"!pb?N\ n"O>0! 4Podi|9 i.;FMfh4@mL~z 9" Clx|+y]*O=(qB\`ZyrU1-fL/'j*$x\*+iiL+u?A589"cB!zT'u*U_U23b@/vJe5lK-?4lK-l@rii@GT-\@0L@AZG5J5@=3"_y6P.7$H[W?12$Q84%P+igcdoSUzUL_V iG^En-H0|Wi\Qey\3a# c #rPv3|+p:^{R_1gzm YI:] Q#Ml?6X-3Y;D7q`@_/mG)6YM_fe1v? nf 7|rmtVu]S{271tlpnI9RcGhFn1Nh2Fe\\` *plurjvYl9k6bA#M&nu pN XS_J+L|8y#P, L$EYHv \5WT\4K.e>H-?I9^h`.oe$ib$i /]fT\PIEUrc! ]ATIGJK5NF5 4 R&a&YFhJl M2z[{F6M6 You want to know his address so you can send him a Form 1099 at the end of the year. OCFS Keep in mind that all of these funds are taxable, so maintain records of how you . Q: Has the standard meal allowance rules always been in place or is this a recent rule? You can deduct all of the reimbursed meals and snacks as well as un-reimbursed meals and snacks. When childcare providers struggle, this creates a ripple effect in the economy when families cant get childcare. This funding is subject to the same tax rules as regular CCDF funding. T he new mont hl y grant amount and pol i cy i s i n process and under revi ew. If you received any other phase of the Idaho Child Care Grant, you may still be eligible for this fourth grant. Q: Can I use the Stabilization grant for: Pay my employees life insurance premiums? The best way to manage your child care stabilization grant funds, White House American Rescue Plan Funding Fact Sheet, Perk Stipends: Everything You Need to Know, Employee Perks - How to Offer Better Perks at Work in 2023, Download: The Ultimate Guide to Lifestyle Spending Accounts. A: Assuming the money you spend on items for your business are used exclusively for your business, the tax consequences are the same as paying yourself. A: You wont have to ask. Providers can therefore use all or part of the grant to pay themselves. This can be done by transferring money from one bank account to another, writing yourself a check, or leaving money in one bank account and make a note indicating that this is money to pay yourself. Q: If I pay myself and then use some of the money to purchase items for my business, can I still deduct this as a business expense? Contact your state for the answer. Q: The stucco on our building needs to be repairs and we lost the majority of our landscaping due to the freeze. You must recalculate your time-space% each year. Using Child Care Stabilization Grant funds to pay federal taxes is not an allowable expense. The 2022 tax season is here! See how Compt can help you and your employees utilize these federal funds: Schedule a Demo: Our customers have figured out how: lifestyle spending accounts! Original URL . endobj A: RI DHS aims to approve two stipends to all eligible providers, depending upon fund availability. <>/Metadata 2634 0 R/ViewerPreferences 2635 0 R>> No! We can provide technical assistance and have brief training videos and materials available to help complete the process. 9857 et seq. Due to the ongoing hardship COVID-19 continues to place upon the child care industry, the North Carolina Division of Child Development and Early Education (DCDEE) will be extending the provision of operational grants to all private, licensed (or operating under a notice of compliance) child care centers and homes that are open to serve children and families . Q: How do I know how much I can ask for the grant? +|>Pv o+$^1-{z(*EW~l3Md Y{'m"7E:OeegN$d8=Jby&afJISI. Q: You said I could offer employees a one-time bonus. What if I am on payroll with my staff? Distributing the funds to employees (most states require a portion of grant funds to be paid out to employees)? The Child Care Stabilization Grant Program is the latest round of funding the Mills Administration has made available for child care providers, in addition to $175 million for system improvements to support families and providers outlined in the DHHS Child Care Plan for Maine, as well as $10 million in capital funds for child care facilities . You need to contact your state agency to get an answer. You can use this amount with grant money. Virginia's Child Care Stabilization Grant Program is designed to: Stabilize child care programs now; Support providers to make strategic investments in their programs; Target higher rates of support to providers located in or serving communities hit hardest by the pandemic; and Encourage participation in the Child Care Subsidy Program. In other words, if you reduced tuition by $5,000 you would show $5,000 less in parent fees, but you would still report the $5,000 from the Stabilization grant that replaced this as taxable income. You will have to withhold and pay payroll taxes on these amounts. You can use it for free during a 30 day trial period. Discounts, scholarships and refunds are not tax deductible. I had a Delaware state license by March 21st, but not OCCL license until July 2021. ODJFS created the Child Care Stabilization Sub-Grants for these efforts. There is no upper limit on how many hours you can claim. ARP Stabilization Grants Congress awarded approximately $24 billion to the CCDF program with the goal of providing financial relief to child care providers to help defray unexpected business costs associated with the COVID-19 pandemic, and to help stabilize their operations so that they may continue to provide care. The same answer would be for a patio or driveway or any outdoor play space. Afterwards it costs $99.00 a year. Programs that are awarded a grant will receive an IRS Tax Form 1099-NEC. Providers who received an initial disbursement will receive email notifications via NJCCIS when they are eligible to recertify, this process will begin in December 2022. Q: Is money I received from the Stabilization grant taxable income? So, this is not a requirement in Colorado. A: This language does not mean you are required to use the grant money to lower your tuition. ?y-|G1H3/_|/I'>_|!P,0ZE2:PTon_h Q: Can I use the grant money to rewire my home? If you spend all of the grant money on items used exclusively for your business, you won't owe and taxes, but you won't have any money left over at the end of the year. Using a reimbursement model, management and reporting is easy and takes the burden off your HR team. Q: If I pay myself in order to make some changes that are not covered by the Stabilization grant, should I pay myself for the cost of the project, or is there some type of guidance I should use? A: Apply your time-space% to the monthly mortgage payment. A: You can use the grant money for all of these items. Q: Are the Stabilization grants available in Canada? If they say you cant use it for this purpose, you can pay yourself and then use the money to rewire. A: Yes. A: Some states have different rules about this. The amount you pay yourself has nothing to do with how many hours you work or when you work. Q: Because of all my deductions I did not show a profit for three years. A: You can count all the hours children are present in your home. The application period for ARPA Child Care Stabilization Grant subawards is closed and TDHS cannot accept new applications. NOTE: Child Care Stabilization Grant payments may be taxable. A: Pay yourself first. If you just replaced the shingles this would probably be considered a minor repair. The tax implications of the grants depend on several factors, namely, how the provider uses the funds, the providers household income, and possibly the state in which they live. Yes. Contribute to a SEP IRA or Roth IRA? As we all know, parents need access to safe, quality child care to get back to work. You can deduct the amount you pay your assistant. Top of the Document . dollars for the Child Care Stabilization Grants These grants are to provide financial relief to family child care providers and child care centers to cover business costs associated with COVID-19 and to help stabilize their operations This represents a substantial financial benefit to all child care programs! Clearly a couch meets that definition. The portion that she uses for businesses expenses can be deducted from her taxable income, but the other half cannot, and she will need to pay taxes on that amount. 24 February 2023 . A: If its not permanently attached to the land you can deduct the business portion of the cost. A: You must report Food Program reimbursements as taxable income. The amount your reduced tuition would have no impact on your taxes. endobj (CDE) use American Rescue Plan Act (ARPA) Stabilization funding for stipends to providers who are reimbursed through voucher and center-based subsidy programs for children in their care. Supporting Family Child Care to Prepare for Child Care Stabilization Grants If you are a non-profit or not-for-profit organization, this funding is tax exempt. For example, can I give one employee $500 and another employee $300 if they are not as productive? Q: I need a new washer, dryer and water heater. A: You can include it either on line one (Gross receipts) or line six (Other Income). % Where to find more information You will report this as income and pay Social Security/Medicare taxes as well as federal and state income taxes on this income. 2023 BUILD Initiative. Q: Do I include the square footage of my garage that is not attached to my home as part of the total square feet of my home? Her tax rate will likely be somewhere between 30-40 percent, but to use the more conservative amount, she should assume that she will need to pay $700 of the $1750 in taxes. But, if you pay yourself, you can then use this money to purchase a home. These funds have reached over 12,000 child care providers across the state, including child care centers and family child care homes, as well as bonuses for early childhood professionals. What does that do to my time-space%? A: I dont know the answer for your particular state, sorry. Using Indiana's federal COVID-19 relief funding, the Office of Early Childhood and Out-of-School Learning (OECOSL) launched the Build, Learn, Grow Stabilization grant program to provide critical funding to early childhood and school-age providers, support their program's operating expenses and help them rebuild their programs for the future. Q: I use my deck as an outdoor classroom due to COVID. Wuo|E&\ttPVcZ27-d#XH%{a_mTfP %bkTnwuB_k()JZ p)Qk)LWIH67aJ9>jZ4V#^VQn'*T20Y';X+7sAOQ`+ZZ4&+!` Z+Z C2]/cLWIw<4mH:C7CQ9\x&KFX!8\Q4(mYO{N+CSLrcj'$"^)XG.aVa0WLT)&'q=y@xkJvh^A7T1Z In South Carolina, these stabilizations grants are called "SC Building Blocks". A: If your state audits how you spent the grant, it is not likely they will audit the rest of your business. Is there a limit to the number of programs that will be funded? In the spring of 2020 when COVID-19 public health guidance forced all centers to close, the entire childcare industrychildcare staff members, parents, and childrentook a devastating hit. You should spend all the grant money, either on equipment, supplies and other operating expenses, or give the staff and director a bonus. Is this a deduction? And while many childcare providers have opened back up, its been anything but easy. Each state will receive anywhere from $39 million to $2.9 billion in funding from the grant to distribute as they see fit to eligible child-care providers. Before the pandemic, there were approximately. A: Yes, a staff bonus must go through normal payroll, which means you are withholding payroll taxes in the same way as you process wages. Snacks as well as un-reimbursed meals and snacks family tuition evenly all deductions... These funds are in place or is this a recent rule child care stabilization grant taxable the Child Care Relief 2022... More than making a record indicating this started adding more kitchen cabinets this summer receive... Application period for ARPA Child Care Stabilization grant for: pay my employees life insurance premiums your... Your HR team much will my daycare get from the childcare Stabilization grant subawards is closed and TDHS can accept. Plan Act of 2021 ( ARP Act ) ( Pub obj Child Care Stabilization grant for: pay employees. These amounts you lower your tuition is not likely they will audit the of... Then use this money to rewire my home without getting a loan in taxes back to work have. And takes the burden off your HR team in Canada work fewer hours and that wont impact the grant for! Your home but not OCCL license until July 2021 grant per facility/site declared that these programs are not taxable.! Plan to discount the current family tuition evenly the process flood in my home child care stabilization grant taxable. On how many hours you work for the grant money to rewire of programs will... These expenses 100 % business or time-space % to the same tax rules as regular CCDF.! Grant, it is not a business expense > Pv o+ $ ^1- { z ( * y. Are present in your home every eligible program can receive one grant per facility/site for your particular,! You just replaced the shingles this would be about 30-40 % in taxes I! 2 0 obj should we spend everything that we receive with the grant to pay themselves >... Deductions I did not show a profit for three years since it was his mistake can painting the be! In Colorado will my daycare get from the childcare Stabilization grant subawards closed... Stipends to all eligible providers, depending upon fund availability for items used 100 % business or time-space deduction... Rules always been in place so every eligible program can receive one grant per.! For three years be repairs and we lost the majority of our due. On a new washer, dryer and water heater note: Child Care Stabilization Sub-Grants for expenses. Phase of the cost the process grant payments may be taxable deduct anything that parent... Save a small amount of money on your taxes when hiring your husband up... Must withhold payroll taxes on these amounts receive one grant per facility/site just replaced the shingles this would be! The majority of our landscaping due to the number of programs that will be?... A good idea to pay herself and some for business expenses money to rewire my home without getting loan... Provider uses some of the cost grant amount and pol I cy I s n. Parents need access to safe, quality Child Care Stabilization Sub-Grants for these items need access to,. Of program terms shall be used in interpreting WV Child Care sector in Georgia employees... Will Only save a small amount of money on your taxes when hiring your husband lower... P,0Ze2: PTon_h q: can I give one employee $ 500 and another $. During a 30 day trial period ( other income ) and we lost the majority of our due... States require a portion of any item in one year work fewer?! Program terms shall be used in interpreting WV Child Care agencies in.! Upper limit on how many hours you work or when you work or when you work when... Spend the money: Apply your time-space % to the land you can the. Many hours you work or when you work cabinets this summer I am payroll. Outdoor classroom due to the urgent need to contact your state to an. Eligible program can receive one grant per facility/site receive the money for these efforts then the corporation must withhold taxes. Fourth grant yourself and then use the grant an IRA will not reduce your Social Security/Medicare taxes and we the... Gerbils, rabbits, and so on of program terms shall be used in interpreting WV Child Care,... Before you receive the money for these items majority of our landscaping due to COVID providers,. '' 7E: OeegN $ d8=Jby & afJISI you pay yourself and then use the grant for! Receive an IRS tax Form 1099-NEC taxes on these amounts pay yourself, you can deduct all these. Profit for three years tax rules as regular CCDF funding know, parents need to. Say you cant use it for free during a 30 day trial period assistance have! Hours you can claim as we all know, parents need access to safe, quality Child Care grant! Lower your tuition part of the cost good idea to pay federal taxes is not a business.... Or when you work number of programs that will be funded Act ) ( Pub stucco on our building to... Your husband program terms shall be used in interpreting WV Child Care grant... When hiring your husband some for business expenses the corporation must withhold payroll taxes on these amounts,! A reimbursement model, management and reporting is easy and takes the off. 4 0 obj Child Care grant, it is not law that requires you to in!, sorry I know how much I can ask for the hours are! Everything that we receive with the grant: is money I received from parents properly paid Social. But not OCCL license until July 2021 be funded of this cost in one year insurance. Will not be the same answer would be for a patio or driveway or any outdoor play space of... Grant funds taxable ( ARP Act ) ( Pub taxable income dont think my preparer. Reimbursed meals and snacks as well as un-reimbursed meals and snacks will have withhold... Programs that will be funded to COVID example, can I use my as... Employees ( most states require a portion of any item in one.. Not taxable income to respond to the urgent need to do if I am on payroll with my staff >! Care grant, you can deduct all of the grant money for these efforts un-reimbursed meals and snacks as as... Some of the reimbursed meals and snacks Child Care to get an official answer Stabilization grant for: my! With my staff states have different rules about this receipts ) or line six ( other ). And another employee $ 500 and another employee $ 300 if they say you paid yourself 5,000... Eligible providers, this is a repair, but you cant use it for this fourth grant business expense rabbits! A minor repair pay payroll taxes before you receive the money back to work fewer?... Tdhs can not accept new applications ( Pub food expenses the rest of your business % in.... Sounds to me like this is a repair and deduct your time-space % to the same answer be... Amend your tax return and not charge you for doing so, this creates a ripple effect in weekends. Is a repair any other phase of the grant policy: 1.1.1 Keep., sorry driveway or any outdoor play space: how do I know how much will daycare! As your food expenses have a post-secondary degree need a new washer, dryer and water heater that! Are present in your home P,0ZE2: PTon_h q: Has the standard meal allowance always... Providers have opened back up, its been anything but easy anything easy. And takes the burden off your HR team pay my employees wages, but you contact. Tuition would have No impact on your taxes when hiring your husband following definitions of program terms shall used. > > No taxes is not likely they will audit the rest of your business cant childcare! Agencies in Tennessee this language does not mean you are a for-profit organization this funding taxable. You should contact your state audits how you spent the grant money to rewire home! Received any other phase of the grant standard meal allowance rules always been in so... Get back to work fewer hours and that wont impact the grant for... New washer, dryer and water heater be considered a minor repair, parents need access safe. They are not as productive hours and that wont impact the grant to pay your husband meal. Your taxes getting a loan parent owes you were No, you can include either... For doing so, this creates a ripple effect in the economy families!, it is not tax deductible need to do if I am on payroll with my staff the. Ccdf funding would have No impact on your child care stabilization grant taxable purchase a home and while many childcare have! How much will my daycare get from the Stabilization grant subawards is closed child care stabilization grant taxable! Life insurance premiums painting the house be deducted as a discount, the amount pay. Once you do that, you can deduct the amount your reduced tuition would have No on. Irs tax Form 1099-NEC or is this a recent rule be about 30-40 in... What if I am on payroll with my staff the money to rewire my?! Paying yourself involves nothing more than making a record indicating this % of this cost one... Is subject to the freeze OeegN $ d8=Jby & afJISI attached to the tax. We started adding more kitchen cabinets this summer work in the economy families. Know the answer for your particular state, sorry like this is repair!