How to File Taxes for Babysitting

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A woman babysitting a young boy who is playing with chalk. (Image: KatarzynaBialasiewicz/iStock/Getty Images)

Babysitters must follow specific tax regulations that cover child care workers under the rules of the Internal Revenue Service (IRS). Most people who babysit are not employees of the family and must report this income as a self-employed worker or sole proprietor. Depending on how many deductions they can claim, babysitters have a few different options for filing taxes for babysitting.

Step 1

Add up all the expenses you incurred while babysitting. These could include mileage from driving to the sites, games and toys you purchased to entertain your charges, and advertising and marketing costs.

Step 2

Ask the families for whom you babysit if they are going to claim your services on their taxes as a household deduction. If they do, and you earned more than $600 from any one family during the year, they must provide you with a 1099 form that shows how much they paid you. Collect 1099 forms from every family from whom you earned more than $600.

Step 3

Calculate how much you made during the year using these 1099s. Your total income also should include payments you received from families that did not provide any income-verification documents.

Step 4

Fill out a Schedule C form (Profit or Loss From Business) if your business expenses exceeded your income, reports Bankrate.com. If you run another business in addition to babysitting, you must use the long form as well, filling out a separate form for each business.

Step 5

Itemize your income and expenses on the Schedule C-EZ form if you have less than $5,000 in expenses, don't have any inventory or employees, don’t have deductions for a home office and operate on a cash basis.

Step 6

Attach the Schedule C or C-EZ to your 1040 tax return, and enter the final amount calculated on the form, whether it's a profit or loss, on line 12 of the 1040.

Things You'll Need

  • Receipts

  • 1099(s)

  • Schedule C or C-EZ

Tip

If you did not have any other income during the year and you ended up making less than $400 after you deduct expenses, you do not have to file taxes on your babysitting earnings, per instructions on IRS Publication 334 that describe the requirements for sole-proprietor income-tax reporting.

Warning

Keep all your receipts to verify your deductions. Although it may be unlikely that you are audited, the IRS requires you to keep your receipts for seven years, because the agency can go back and review your prior tax returns whenever it chooses.

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