Total the business square footage and divide by the total square footage to get the space percent. All capital expenditures need to be depreciated, and each category has a different rule. It would be best to work with your tax preparer on this area. One area of depreciation that day care providers are not often aware of is their home. Day care providers are always better off financially by depreciating their home.
Providers can also depreciate their car if they use the Actual Car Expense Method.
This is one thing providers may not be aware of when starting child care. One way to avoid these payments, if possible, is to have one's spouse increase his or her withholdings. If that is not an option, there is a suggested rule to follow. Talking with your tax preparer may help you further in this area. It is paid to enable you to be eligible for Social Security.