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Posted by Harlan Lunsford on November 7, 2006, 8:19 am
Please log in for more thread options Elizabeth wrote:
> I have a client who is a photographer (mainly weddings and
> special events). She has a 2-yr old son who needs care both
> while she is shooting and while she is editing. She
> estimates that she needs 1200 to 1400 hours of child care
> this year alone. Are there any legitimate ways she can make
> this a business deduction? I'm thinking -- make the
> babysitter an employee? The photographer has a studio
> separate from her home, and in the studio she has one extra,
> totally unused room that could be converted into a
> child-care space. If she actually employed the babysitter,
> and provided the major area of care within her studio (even
> though the sitter could take the kids to activities and
> maybe even to her own home on "outings"), would that qualify
> for a legitimate business deduction?
>
> If it could be structured as a legitmate business expense
> with the baby-sitter as an employee, is there any way the
> photographer could pay the babysitter as an independent
> contracter instead of as an employee (much as she pays other
> photographers who assist her on various shoots), issuing a
> 1099-MISC?
>
> The photographer is currently a sole-prop.; would it make
> any difference if the business was incorporated as an
> S-corp? Would the value of the child care service be
> imputed to the photographer on her w-2 anyway?
>
> Currently, my thoughts are that babysitting is a personal
> expense and only the first $3000 of it can qualify for
> personal deduction on her 1040. But I told her I would ask
> for opinions from you folks to see if anyone could suggest a
> creative, yet legal and legitimate, way of making this a
> business expense.
What is it "they" say? something like... first impressions
are usually correct?
Even IF ok for a proprietor using business premises, said
provider would not qualify as independent contractor.
And any S corporation benefits would be taxable to a 2%
shareholder anyway.
Just hope the photographer has a profit, otherwise, no child
care credit even.
ChEAr$,
Harlan Lunsford, EA n LA
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