Does this count as Space?
Your spouse has a playroom in the basement that is only used by your family. Does this room count toward your Time-Space Percentage?
❌ No. It is not used for your family child care business.
After the children leave for the day, you spend an hour cleaning and sanitizing your childcare space. Does this time count?
✅ Yes. Cleaning after daycare is business time.
True or False: Only rooms used exclusively for daycare can be included in your Space Percentage.
❌ False. Family child care providers have a special IRS exception. Rooms used regularly for daycare count even if family members also use them.
You get your nails done because you give tours of your program and want to maintain a professional appearance. Can your business deduct this expense?
❌ No. Personal grooming expenses are not deductible business expenses under IRS rules.
You store seasonal toys in your garage and only go there a few times each year to switch them out. Does the garage count as business space?
❌ No. Occasional or seasonal use is not considered regular business use.
You're relaxing and watching television at home in the evening. Does this time count toward your Time Percentage?
❌ No. Personal leisure time is not business time.
True or False: The Time-Space Percentage only applies to business-only expenses.
❌ False. The Time-Space Percentage applies to shared expenses. Business-only expenses are generally 100% deductible.
Children are in your program from 7:00 a.m. until 11:00 p.m. Does this count as working two shifts?
❌ No. This is one long business day. Two shifts would involve separate groups of children with a break between shifts.
You keep classroom supplies in a hallway closet and access it three times each week during daycare hours. Does this space count?
✅ Yes. The hallway closet is used regularly for business purposes, so it counts toward your Space Percentage.
You spend Sunday evening planning next week's learning activities. Does this count as business time?
✅ Yes. Planning curriculum and activities is a business activity.
True or False: The IRS created the Time-Space Percentage to recognize the unique nature of home-based child care businesses.
✅ True. The family child care exception allows providers to use shared areas of their home without requiring exclusive business use.
You have a large fish tank in your dining room that you use during science lessons. Does the fish tank increase your Time-Space Percentage?
❌ No—but here's the important distinction!
The dining room counts toward your Space Percentage if it is regularly used for daycare. The fish tank itself does not increase your Time-Space Percentage. However, if the fish tank is used by both your family and your daycare business, it may be considered a shared expense, meaning it could be partially deductible using your Time-Space Percentage.