Should I report the list price of an item I purchased for my daycare business, or the full after-tax amount I paid for it?

by Robert D. Hornick, CPA | Feb 05, 2019

I am a home daycare provider, and I am currently going through my receipts for possible deductions. For instance, a kid’s toy has $23.99 as the listed price. Do I report that or what is at the bottom of the receipt after sales tax?

Assuming that you are operating as a proprietorship and the item you refer to is an ordinary and necessary business expense for your business, the amount that you paid is the amount of the business expense for tax purposes.
For more resources, check out PICPA’s Money & Life Tips, Ask a CPA, or CPA Locator.

Answered by: Robert D. Hornick, CPA, is with Hornick & Associates LLC in Philadelphia.

The responses are based on the limited information provided by the questioner and apply the laws and regulations at the time of posting. Other options could arise as rules and regulations may change over time, including but not limited to the passage of the Tax Cuts and Jobs Act of 2017. They are intended to provide general information, not specific accounting or tax advice; they are not intended or written to be used and cannot be used for the purpose of avoiding or evading taxes or penalties under the IRS code or regulations. Views expressed do not imply an opinion of the PICPA, its officers, directors, employees, or members.
Financial FAQs

Search the most frequently asked finance and accounting questions and read the responses from PICPA members. Always consult a CPA before taking action.