In this presentation, we will take a look at a method to track tax deductions related to childcare within our business file within QuickBooks using a classes method. Here we are on the homepage, we currently have the open windows open, we can open the open windows by going to the view drop down and selecting the open windows list. We're now going to enter these transactions into the check register from our bank statement by going to the banking drop down and the US register. Here is our checking account. That's the one we want going to open that up. We've been entering the data directly into our checking account from the bank statement and we will be continuing with this process here.

Here is our bank statement we've been writing just checks. But remember that any type of transaction that if it's a In other words, if we had an E transaction or an electronic transfer, or if we write checks if we wrote the out of our checking account, or if they came out of our checking out the business checking account, then we're going to use that them to enter them into our QuickBooks system. And that's how we're tracking this information. Now, we're going to keep on moving down here to the Epiphone and in the childcare. So we're going to enter some just normal business expenses at the phones can be a vendor that we buy. And so product inventory guitars and arcades from, that's going to be a normal, we're going to say business expense, we're not going to get into tracking inventory discussion, but business expense, then we'll have the childcare, which we consciously paid out of our business account, knowing that it's not a business expense, but wanting to be able to track it in our business QuickBooks account because it's easier to do so.

And that's, that's the method that we are using here. We'll also enter at least one or two of these sunlight rentals and Verizon phone company and the rental payments that we make because that's where we do our work. In a rent we'd rent a place to do work in. These are normal business expenses, in other words, so we're going to do the Epiphone first this is just a normal business expenses. And then we'll do our new item, the ease childcare. So we'll go back to our reports this happened on 311.

That's March 11. We're working in the year 2019. So March 11 2019 1028, the check number and Epiphone should populate for us automatically if we start typing it in, because that's a normal vendor we've used in the past 5100. And note that it's the type of account is at cost of goods sold type account. Again, this is kind of dealing with inventory. We're not going to get into that, but just note, it's already assigned.

It's assigned to an income statement account. And that's what we're going to use as we have done in the past. So we're going to enter that we don't even need a class we're going to keep the check number. It has a duplicate, that's okay for now. And then the next item we're going to be doing, gonna highlight that and so we've done that is now the ease childcare. So this is someone we're going to say this could be daycare or this could be something like a preschool maybe that we put could possibly be deducted, maybe.

So, it might be something that our tax preparer asked for last year and say, okay, maybe we should start tracking this in a more formal way. And so we're putting this in every time we pay out of the checking account, in our business checking accounts that we can track it. So not a business expense, but one we want to track for personal. So that's going to be our new item, we're going to say, all right, that happened on 315. Check number 1029. We're going to add this which is going to be easy.

Child Care, that's our that's the daycare facility or whatever. And we're going to say quick add and vendor 125. And then we're going to add the new account, which again, it's personal, so I'm going to label that as we add the new account. I'm going to type this in here. I copied and pasted but you could type it in there. It's going to be personal deduction for childcare.

Clearly labeled not a business expense, we want to make that clear as we enter this information in, we can't see the class, but we can go to the class by going to the splits item. Actually, once I hit split, it's going to set up because I haven't set the account up. So let's set up the account. That would be nice. It's going to be an expense type account, personal deduction, childcare. That's what we want.

So we will then say Save and Close, then go to the split, so that we can Vinci the class and add it being the tax personal tax deduction, personal class, and then we'll say, record, keep the check number again. And then we're going to go to our profit and loss report by classes. By going to the reports drop down, we're going to go down to company and financial and we're looking for the profit and loss by class. profit loss by class changing the dates from a 10119 to 1230 119. January 1 to December 31 2019. And we could see that then our tax class will include the charitable deductions and the new one here, which is the childcare, the 125.

So it's not and so we still have to deal with these kind of zeros in the unclassified area, but it does give us a proper profit and loss for the business. And it tracks these deductions for the personal side, and it does it fairly easily. To do that. If we then double click on this item, you'll see that we have our amounts that we just entered. This is charity again, like double click on this item, then there's the amount which is entered for each childcare, double clicking on that, there is our check. So I'm going to close this back out, close this back out.

I'm going to go back to our bank step and cross that out and say that we have done that one. Now I'm going to enter a couple others just to go through some normal transactions. This is our rental company. This is our This is Verizon. So this would just be normal entering data from our bank statement into our checking account. So we'll go back over here, checking account, we're going to say that we paid the rental company that's 315 1031 is to check and it's called sunlight rental populates for us automatically because we already have it set up, we're going to say that that's going to be for 1500.

Rental expense, we don't need to assign a class in this case, because the unclassified is the default, meaning those are normal business expenses. So there we have that. And we'll do one more here, that being Verizon, which is a phone company, that's who our phone company is, we pay them for phone services, and therefore it's going to be into the telephone expense or something similar to that. So we're going to that happened on 315 1035. And we're going to say Verizon 400 Then the amount we paid telephone expense normal expense, we don't need the split column opened up because we don't need to assign a class because it's going to go into the default, which is unclassified. And okay, so so we're just entering the normal type of transactions, and then just adding these transactions that will be for each rental.

And just like with any process, once we set it up, this account is already set up, so the account will be there by default. And that'll make it easier to do in the future. It might be not as easy to not see the classes, maybe the classes, we might miss a class setup. But note that as we go back to the profit loss by class, it'll be easy for us to say, Okay, look, this one is a personal and if there's an amount in the unclassified area, we could just go right back into it and reclassify it within QuickBooks to the proper class, which will be over here.