Will self-employment deductions affect our decision??

[MNchick1998 26]

My situation is kind of complicated. I provide daycare and respite services to my niece and nephew. They were adopted by my parents back in 2010. These daycare and respite services began back in 2014 when I also moved in with them all along with my daughter. So there are six of us all living under one roof. Because I am a biological aunt living in the home, I do not have to have a daycare license to operate a daycare for them. So I can deduct all of my business expenses right here from the home we all live in. Before I met my husband, that was wonderful because I usually would get a nice tax refund the following year due to all of my deductions. On top of the daycare and respite services I provide, I am also employed at full-time hours with a company called Accra Care. I am a PCA through Accra Care on top of being self-employed. 

 

My problem is that since 2014, I have been deducting all of my expenses including rent and meals and travel, etc. That in turn lowers my Net income so I get bigger tax breaks. So let's say for example in 2017, I grossed close to $66k but my net is $18k due to rent and all the other expenses that go along with daycare. I sent all of my tax transcripts from 2014-2016 including W2's and 1099-MISC's and the last years worth of paystubs from Accra and monthly self-employment checks. Our case was complete in less than 5 weeks but I received a letter stating I needed to send my 2016 return schedules to my husband for the interview. The schedules will show all of my deductions. 

 

So here's my concern. Even though everyone says they go by gross, why are they wanting to see my deductions? I'm sending everything to my husband to show him and am working on my 2017 tax return as we speak. Except now, I'm leery of putting any deductions because I want them to see what my true income is. I'm so confused. I'm worried they are going to see that my gross income is more than enough to support us 3 but are going to look at my deductions from 2016 and say we need a joint sponsor. The problem with that is that my parents, who I would ask only to help, make less than me combined and they have a household of 4 already. We cannot combine our incomes even if we all live together so I am so confused. Our interview will most likely be before March and I don't know what to do. I did send a letter in with my packet to NVC explaining all of this already so I may be worrying about nothing. I don't know.

[TNJ17 1,329]

Hmmm I’m sorry to be blunt, but that daycare of yours doesn’t seem like a daycare or “self-employment” to me. It just seems like you’re taking care of your children who live in your house. You don’t have a business license and you don’t seem to be making any money off of it except a few deductions in your tax bills. You need to show USCIS that you make 125% of poverty line in your job. If your tax refunds don’t show that, then you need to make up the difference with assets and you can’t use the car your drive and the house you live in. 

[NikLR 13,227]

~~removed duplicate topic in another forum.  Please only start one thread per topic. ~~

[MNchick1998 26]

This is a daycare. I have an EIN for tax purposes. My parents adopted my niece and nephew and in the adoption agreement, they were granted daycare and respite services by either a trained caregiver in the home or at a licensed daycare out of the home. If you know your statutes in Minnesota, you would know that. Here's a link to help you out. https://www.revisor.mn.gov/statutes?id=245A.03&year=2017&keyword_type=all&keyword=245A.03

 

My parents pay me a monthly check for daycare and respite services. They then submit their payments that they've made to me. The State of Minnesota had to approve me as a provider, which they did. The state then reimburses my parents every month the amount they pay me. It's really not that hard to figure out. So my question isn't whether my business is legit or not. It was asking if they will look at my gross income like it says they do for the past year or will they look at my income after deductions. When I filled out my AOS, I was able to put my anticipated year income for 2017 because I had already been paid up until December and knew what I would be receiving for daycare. 

 

On average, I make $21k a year from this self-employment so I'd say I'm making a nice income from it. 

 

Edited January 21, 2018 by MNchick1998

[MNchick1998 26]

I'm at the stage where my husband is going to be having his interview within two months. I have already proven that my income is what is needed. My best option to to ask an attorney this question. 

[Jeanne Adil 1,651]

not sure who everybody is that told you gross is what they look at'

my gross is well over the amount needed but NVC kept saying i did not meet the requirments as i have a monthly income from an annunity which was bought with taxed dollars and i only pay on the interest

my attorney said they look only at line 37(? think that is the nimber) at taxable income

you need income for the 6 people plus the new husband so you may require cosponsor

I think you should consider getting a business licence / not sure how you are getting away with claiming house as a business for day care center without one

[MNchick1998 26]

OMG. This isnt about daycare licensing. This was a waste of time. 

 

I don't need a license. You don't know your laws. And my household doesn't have to include all 6 of us. It's just us 3 since there are other members of the family bringing in income. 

https://www.revisor.mn.gov/statutes?id=245A.03&year=2017&keyword_type=all&keyword=245A.03

2017 Minnesota Statutes

Resources

Chapter 245A

Section 245A.03

•  

245A.03 WHO MUST BE LICENSED.

Subdivision 1.License required.

 

Unless licensed by the commissioner, an individual, corporation, partnership, voluntary association, other organization, or controlling individual must not:

(1) operate a residential or a nonresidential program;

(2) receive a child or adult for care, supervision, or placement in foster care or adoption;

(3) help plan the placement of a child or adult in foster care or adoption or engage in placement activities as defined in section 259.21, subdivision 9, in this state, whether or not the adoption occurs in this state; or

(4) advertise a residential or nonresidential program.

§

Subd. 2.Exclusion from licensure.

 

(a) This chapter does not apply to:

(1) residential or nonresidential programs that are provided to a person by an individual who is related unless the residential program is a child foster care placement made by a local social services agency or a licensed child-placing agency, except as provided in subdivision 2a;

(2) nonresidential programs that are provided by an unrelated individual to persons from a single related family;

(3) residential or nonresidential programs that are provided to adults who do not misuse substances or have a substance use disorder, a mental illness, a developmental disability, a functional impairment, or a physical disability;

(4) sheltered workshops or work activity programs that are certified by the commissioner of employment and economic development;

(5) programs operated by a public school for children 33 months or older;

(6) nonresidential programs primarily for children that provide care or supervision for periods of less than three hours a day while the child's parent or legal guardian is in the same building as the nonresidential program or present within another building that is directly contiguous to the building in which the nonresidential program is located;

(7) nursing homes or hospitals licensed by the commissioner of health except as specified under section 245A.02;

(8) board and lodge facilities licensed by the commissioner of health that do not provide children's residential services under Minnesota Rules, chapter 2960, mental health or chemical dependency treatment;

(9) homes providing programs for persons placed by a county or a licensed agency for legal adoption, unless the adoption is not completed within two years;

(10) programs licensed by the commissioner of corrections;

(11) recreation programs for children or adults that are operated or approved by a park and recreation board whose primary purpose is to provide social and recreational activities;

(12) programs operated by a school as defined in section 120A.22, subdivision 4; YMCA as defined in section 315.44; YWCA as defined in section 315.44; or JCC as defined in section 315.51, whose primary purpose is to provide child care or services to school-age children;

(13) Head Start nonresidential programs which operate for less than 45 days in each calendar year;

(14) noncertified boarding care homes unless they provide services for five or more persons whose primary diagnosis is mental illness or a developmental disability;

(15) programs for children such as scouting, boys clubs, girls clubs, and sports and art programs, and nonresidential programs for children provided for a cumulative total of less than 30 days in any 12-month period;

(16) residential programs for persons with mental illness, that are located in hospitals;

(17) the religious instruction of school-age children; Sabbath or Sunday schools; or the congregate care of children by a church, congregation, or religious society during the period used by the church, congregation, or religious society for its regular worship;

(18) camps licensed by the commissioner of health under Minnesota Rules, chapter 4630;

(19) mental health outpatient services for adults with mental illness or children with emotional disturbance;

(20) residential programs serving school-age children whose sole purpose is cultural or educational exchange, until the commissioner adopts appropriate rules;

(21) community support services programs as defined in section 245.462, subdivision 6, and family community support services as defined in section 245.4871, subdivision 17;

(22) the placement of a child by a birth parent or legal guardian in a preadoptive home for purposes of adoption as authorized by section 259.47;

(23) settings registered under chapter 144D which provide home care services licensed by the commissioner of health to fewer than seven adults;

(24) substance use disorder treatment activities of licensed professionals in private practice as defined in section 245G.01, subdivision 17;

(25) consumer-directed community support service funded under the Medicaid waiver for persons with developmental disabilities when the individual who provided the service is:

(i) the same individual who is the direct payee of these specific waiver funds or paid by a fiscal agent, fiscal intermediary, or employer of record; and

(ii) not otherwise under the control of a residential or nonresidential program that is required to be licensed under this chapter when providing the service;

(26) a program serving only children who are age 33 months or older, that is operated by a nonpublic school, for no more than four hours per day per child, with no more than 20 children at any one time, and that is accredited by:

(i) an accrediting agency that is formally recognized by the commissioner of education as a nonpublic school accrediting organization; or

(ii) an accrediting agency that requires background studies and that receives and investigates complaints about the services provided.

A program that asserts its exemption from licensure under item (ii) shall, upon request from the commissioner, provide the commissioner with documentation from the accrediting agency that verifies: that the accreditation is current; that the accrediting agency investigates complaints about services; and that the accrediting agency's standards require background studies on all people providing direct contact services;

(27) a program operated by a nonprofit organization incorporated in Minnesota or another state that serves youth in kindergarten through grade 12; provides structured, supervised youth development activities; and has learning opportunities take place before or after school, on weekends, or during the summer or other seasonal breaks in the school calendar. A program exempt under this clause is not eligible for child care assistance under chapter 119B. A program exempt under this clause must:

(i) have a director or supervisor on site who is responsible for overseeing written policies relating to the management and control of the daily activities of the program, ensuring the health and safety of program participants, and supervising staff and volunteers;

(ii) have obtained written consent from a parent or legal guardian for each youth participating in activities at the site; and

(iii) have provided written notice to a parent or legal guardian for each youth at the site that the program is not licensed or supervised by the state of Minnesota and is not eligible to receive child care assistance payments;

(28) a county that is an eligible vendor under section 254B.05 to provide care coordination and comprehensive assessment services; or

(29) a recovery community organization that is an eligible vendor under section 254B.05 to provide peer recovery support services.

(b) For purposes of paragraph (a), clause (6), a building is directly contiguous to a building in which a nonresidential program is located if it shares a common wall with the building in which the nonresidential program is located or is attached to that building by skyway, tunnel, atrium, or common roof.

(c) Except for the home and community-based services identified in section 245D.03, subdivision 1, nothing in this chapter shall be construed to require licensure for any services provided and funded according to an approved federal waiver plan where licensure is specifically identified as not being a condition for the services and funding.

 

As for household size, Number 7 is the answer to that question. So my household size is 3. 

 

Part 5. Sponsor’s Household Size Add together the number of persons for whom you are financially responsible. Some of these persons may not be residing with you. Make sure you do not count any individual more than once. In some cases the same person could fit into two categories. For example, your spouse, whom you would enter in Item Number 3., might also be a lawful permanent resident for whom you have already sponsored using Form I-864 (Item Number 6.). If you included your spouse on Item Number 3., do not include him or her again on Item Number 6. Item Number 1. Provide the number you entered in Part 3., Item Number 28. If you or someone else is completing Form I-864 on a computer, this box will auto-populate. Item Number 2. This field is auto-populated to “1.” Item Number 3. Enter “1” if you are married. Enter “0” if you are not married. Item Number 4. Enter the number of unmarried children you have who are under 21 years of age, even if you do not have legal custody of these children. You may exclude any unmarried children under 21 years of age, if these children have reached majority under the law of their place of domicile and you do not claim them as dependents on your Federal income tax returns. Item Number 5. Enter the number of any other dependents. You must include each and every person whom you have claimed as a dependent on your most recent Federal income tax return, even if that person is not related to you. Even if you are not legally obligated to support that person, you must include the person if, in fact, you did support that person and claimed the person as a dependent. Item Number 6. Enter the number of lawful permanent residents whom you are currently obligated to support based on your previous submission of Form I-864 as a petitioning, substitute, or joint sponsor, or Form I-864EZ, Affidavit of Support Under Section 213A of the INA, as a petitioning sponsor. Include only those persons who have already immigrated to the United States. Do not include anyone for whom your obligation to support has ended through the sponsored immigrant’s acquisition of U.S. citizenship, death, abandonment of lawful permanent residence in the United States, acquisition of 40 quarters of earned or credited work in the United States, or obtaining a new grant of adjustment of status while in removal proceedings based on a new affidavit of support, if one is required. Form I-864 Instructions 07/02/15 N Page 7 of 16 Item Number 7. This question gives you the option of including certain other non-dependent relatives who are living in your residence as part of your household size. Such relatives may include your mother, father, sister, brother or adult children, if they are living in your residence. However, the only reason to include these relatives in your household size is if you need to include their income when you calculate your household income for purposes of meeting the income requirement for this affidavit. To be considered, any relative included in this category must sign and submit Form I-864A, Contract Between Sponsor and Household Member. Item Number 8. Household Size. Add together Part 5., Item Numbers 1. - 7. and enter the number in the space provided. If you or someone else is completing Form I-864 on a computer, this box will auto-populate.

 

And as for income they consider, this comes directly from USCIS.

 

Part 6. Sponsor’s Employment and Income Item Numbers 1.a. - 1.d. Sponsor’s Employment. Select all the boxes that apply to you. You, as the sponsor, may not rely on a household member’s income from illegal acts, such as proceeds from illegal gambling or drug sales, to meet the income requirement even if the household member paid taxes on that income. Item Number 2. Current Individual Annual Income. Enter your current, individual, earned or retirement, annual income that you are using to meet the requirements of this affidavit and indicate the total in the space provided. You may include evidence supporting your claim about your expected income for the current year if you believe that submitting this evidence will help you establish ability to maintain sufficient income. You are not required to submit this evidence, however, unless specifically instructed to do so by a U.S. Government official. For example, you may include a recent letter from your employer, showing your employer’s address and telephone number, and indicating your annual salary. You may also provide pay stubs showing your income for the previous six months. If your claimed income includes alimony, child support, dividend or interest income, or income from any other source, you may also include evidence of that income. Item Number 3. - 17. Current Annual Household Income. This section is used to determine the sponsor’s household income. If your individual annual income listed in Item Number 2. is greater than 125 percent (or 100 percent if you are on active duty in the U.S. Armed Forces or U.S. Coast Guard and sponsoring your spouse or child) of the Federal Poverty Guidelines for your household size from Part 5., Item Number 8., you do not need to include any household member’s income. See Form I-864P for information on the Federal Poverty Guidelines.

[MNchick1998 26]

Current Annual Household Income. This section is used to determine the sponsor’s household income. If your individual annual income listed in Item Number 2. is greater than 125 percent (or 100 percent if you are on active duty in the U.S. Armed Forces or U.S. Coast Guard and sponsoring your spouse or child) of the Federal Poverty Guidelines for your household size from Part 5., Item Number 8., you do not need to include any household member’s income. See Form I-864P for information on the Federal Poverty Guidelines.

 

This is what they look at to determine your income. I will contact an attorney.

[gregcrs2 1,778]

1 hour ago, MNchick1998 said:

 

So here's my concern. Even though everyone says they go by gross, why are they wanting to see my deductions? I'm sending everything to my husband to show him and am working on my 2017 tax return as we speak. Except now, I'm leery of putting any deductions because I want them to see what my true income is. I'm so confused. I'm worried they are going to see that my gross income is more than enough to support us 3 but are going to look at my deductions from 2016 and say we need a joint sponsor. The problem with that is that my parents, who I would ask only to help, make less than me combined and they have a household of 4 already. We cannot combine our incomes even if we all live together so I am so confused. Our interview will most likely be before March and I don't know what to do. I did send a letter in with my packet to NVC explaining all of this already so I may be worrying about nothing. I don't know.

When you are providing tax returns, they want you to provide every page of it, along with your W2s and 1099s.

[geowrian 22,337]

USCIS doesn't really care how much you pay in taxes. They want to know how much you really make so that you are able to support the intending immigrant(s). You have a duty to pay as little taxes as possible, but to pay all taxes owed. That's it.

 

1 hour ago, MNchick1998 said:

I sent all of my tax transcripts from 2014-2016 including W2's and 1099-MISC's and the last years worth of paystubs from Accra and monthly self-employment checks. Our case was complete in less than 5 weeks but I received a letter stating I needed to send my 2016 return schedules to my husband for the interview. The schedules will show all of my deductions. 

They requested your 2016 tax return schedules, so you need to send those. I generally try not to guess why they want what they want, but presumably they want to verify that the income makes sense and is accurate. USCIS is not the IRS, but I'm sure people have tried to pad their numbers so they look at tax returns very closely for self-employment earners.

[gregcrs2 1,778]

Disregard my previous post.  I see you provided your tax transcripts.  Your tax transcripts show a summary of your deductions.  Don't know why they would want to see your itemized deductions other than something seeming unusual such as unusually high deductions.  Hope you had a tax professional do your taxes.  Anyway, provide what is asked for.  Nothing more and nothing less.  

Edited January 21, 2018 by gregcrs2

[MNchick1998 26]

In a family day care, I can deduct so many things. Because all of the money I make goes back into my home as my daycare business. 

 

Starting at page 14, you can see all the deductions I am able to take. Thank you for the actual support and advice from the last couple of people. I do appreciate it.

https://www.irs.gov/pub/irs-pdf/p587.pdf

 

[NikLR 13,227]

Okay so self employment is weird, it's ONLY judged upon your tax returns each year.  Also your deductions do not help you with immigration.  Because you probably claim so many, you may end up with a negative income which obviously hinders you. I suggest a joint sponsor.  

[Lemonslice 4,841]

25 minutes ago, NikLR said:

Okay so self employment is weird, it's ONLY judged upon your tax returns each year.  Also your deductions do not help you with immigration.  Because you probably claim so many, you may end up with a negative income which obviously hinders you. I suggest a joint sponsor.  

I suggest you also file your 2017 taxes asap, maybe with less deductions so your net income is higher.

[MNchick1998 26]

I can't combine incomes with household members according to uscis. I don't quite understand that. I'm going to file my 2017 tax return tomorrow my income before deductions is close to $65k. After deductions, it's $53k for our household of 3. I have to make a correction to my I-864 so I'm going to call NVC tomorrow and see what they want me to do. Thank you everyone for the helpful advice.

 

https://www.***removed***/affidavit-of-support/joint-sponsor.html