Becoming a Home-Based Daycare Provider

by Michelle Lee

Becoming a Home-Based Daycare Provider

To some, family daycare reads like a perfect help-wanted ad: Be your own boss, make money caring for children from home. But with a turnover rate of more than 30 percent  — largely due to long hours, low wages, and stress  — turning your house into a childcare facility isn't for everyone. "A lot of new providers love caring for children," says Holly McDonough-Abunassar, president of the Child Care Parent/Provider Information Network, based in Bowie, MD, "but they aren't prepared to run a business."

If you're thinking of starting a home-based daycare center, do some research, get some training (through either your local childcare resource and referral agency or your state licensing agency), and, above all, talk it over with your family. Some tips to make your endeavor a success:

Childcare laws differ from state to state, so get a copy of the rules that apply to yours from your state licensing agency, which usually falls under the Office of Childcare Administration or the Department of Social Services. Many states require childcare providers to be licensed. The application process may involve tedious paperwork and months of waiting, but it's worth it: In some states, as a licensed provider, you'll be eligible for food discounts, tax deductions, and training seminars.

File personal and medical information for each child in your care, including attendance records and emergency contact numbers. Organized business files will be priceless come tax time, because many items used for your business will be deductible. Keep receipts for all daycare purchases, income and expense reports, copies of your liability insurance policy, and signed contracts. And get a computer, suggests Marian Krapf, a family daycare provider for five toddlers in Jackson, NJ. Krapf uses Childcare Professional by Kask Software, which tracks expenses and income, helps plan menus, and records children's information  — all in one place.

If you have the space, designate one portion of your house for childcare and another for living. And reassure your kids that it's still their home. Keep special toys and personal items in their room so they don't have to share everything.