This blog was originally published Jan. 2, 2018, and was updated on Nov. 22, 2024, with new information. As the end of the year approaches, child care providers have a lot on their minds, including managing enrollment, schedules and budgeting for the coming year. Plus, caregivers are also likely working on distributing daycare invoices for each family they served throughout the year.
Addressing FAQs About Year-End Daycare Invoices
Check out this list of frequently asked questions surrounding year-end daycare invoices to help you navigate this process!
Are Daycare Invoices Required?
While child care providers give this information on a weekly or monthly basis as they are paid, they are not required to provide a year-end receipt to parents.
Though year-end receipts are not required, it is still prudent and professional to prepare and distribute invoices for parents.
What Are the Benefits of Daycare Invoices?
While time consuming, creating these invoices will provide a host of benefits down the road.
First, it is courteous to provide this record to parents, as many of the families your center serves may qualify for tax credits in accordance with the 2441 form from the IRS. As parents seek to take advantage of this credit, care providers should be prepared to give them a comprehensive list of services in a timely manner.
Additionally, preparing the year-end receipt will help to ensure that you and the family are on the same page with how much they owe and have been charged. This will be valuable in the event of an audit, allowing your center to clearly demonstrate exactly how much you made, and that your records match how much each family says they paid you.
What Should Be Included in a Daycare Invoice?
When building out your year-end invoice, you will want to include your name and contact information, as well as the name and contact information of the specific family.
You will then want to include a line that describes what each expense accrued by the child was for, as well as the price. This might include:
- Child care tuition
- Meals
- Special equipment
- Transportation fees
- Late pickup fees
Once all of these charges are accounted for, you will want to include when the parent paid, and how they paid. For example, did they pay by cash or card, etc.? This will make it easy for parents to confirm each charge by consulting payment confirmation emails, or their checkbooks.
Gathering all of this information can be time consuming. It might take some time to locate each monthly receipt. If your child care center uses Procare, your families can easily print or email year-end statements!
Who Should Receive an Invoice?
The family of each child you cared for throughout the year should receive an invoice. It can be easy to overlook children that only attended a few times, or who left in the middle of the year; however, accounting for this revenue is equally as important to your financial records.
With Procare, providers can send invoices to families with currently enrolled children, as well as those who had children attend at some point during the year.
Extra Year-End Forms to Be Aware Of
In addition to the statements providers send out, there are also some common tax forms associated with year-end that daycare owners should be aware of.
- 2441 Form:Again, this is the form parents must fill out in order to receive child care credits and deductions.
- W10:Parents are required to have this form filled out by caregivers in order to be considered for child care tax deductions. Providers are required to fill out this form if requested by a parent, and must provide their Employer Identification Number (EIN).
How a Child Care App Can Help!
With the end of the year approaching, we hope these answers and tips will help to create organized daycare invoices in an efficient way.
If your center isn’t using child care management software to handle invoices and other billing-related tasks, download our free  “Why Your Child Care Program Needs Integrated Invoicing, Billing and Payments” eBook to learn how Procare can save you time and money by automating invoices, easily processing payments, viewing family balances, and more!
