Daycare Tax Tips

Meal rates set in July are used to calculate food deductions for the following year

Let me explain . . .

The USDA adjusts meal reimbursement rates for the Child and Adult Care Food Program every July 1st. Because of this, child care providers who participate in the food program will generally see their reimbursements increase during the second half of the year.

USDA meal rates can also be used to calculate a food deduction for income tax purposes. In that case, providers preparing a tax return for a particular year must use the rates set on July 1st of the PRIOR year.

Yes, this can be confusing.....

Even though food program reimbursement rates change in July, only one set of standard meal rates applies for each tax year.

For example, when preparing your 2013 income tax return, you would use the meal rates set on July 1, 2012.

Last updated 17 December 2013

Posted on 2009-07-28 20:43:08