Question

I have a question about childcare provider taxes. If I’m a childcare provider without a W-2, how do I file taxes for childcare income I earn?

Answer

The IRS usually considers childcare providers as independent contractors. Since independent contractors are self-employed, you should report your income on Schedule C.

Also, if your income minus expenses from self-employment is more than $400, you must file Schedule SE. This will determine your taxes for childcare.

However, if a state health and welfare agency pays you to care for the children of public-assistance recipients, you’re performing chore services, which will change the childcare provider taxes ramifications. Since the state agency controls your wages, it should issue you a W-2 and withhold your childcare provider taxes. However, if you receive a Form 1099-MISC, do both of these:

  • Enter the payments as wages.
  • Attach a statement to the return explaining the nature of the payments.

Related Topics

Related Resources

Health Insurance Premium Deduction

Not sure if you can deduct health insurance premiums? Review the rules about deducting health insurance premiums with the tax experts at H&R Block.

Filing Taxes When a Loved One is in Prison

If you have a family member in prison, tax time may be complicated. Join H&R Block as we answer common questions about filing taxes for someone in prison.

Deduct Legal Fees Related To Divorce

Is it possible to deduct legal fees related to divorce proceedings? Learn more from the tax experts at H&R Block.

Social Security Dependent Benefits

Does your child receive Social Security benefits? Learn how these benefits may affect their taxes. Get tax answers from H&R Block.