How to Start a Home Daycare

The 10 steps

1. Check your state's family child care rules

   Every state regulates home daycares differently. Search '[your state] family child care licensing' on the .gov site. Some states exempt providers caring for 3 or fewer unrelated children; others require licensing from day one. Pull the rules PDF and read the sections on capacity, square footage, fire safety, and background checks before anything else.

2. Decide your capacity and age mix

   Capacity limits commonly allow a single provider to care for 6–8 children, with stricter caps on infants and toddlers, but this varies widely by state and provider. Two providers can usually go to 12 in many states. Decide the mix you want (infants are higher-revenue but more labor-intensive) before you market.

3. Get the legal structure right

   Consider forming an LLC to separate personal and business liability. Costs and annual fees vary widely by state — ask an accountant or attorney. Get an EIN from the IRS (free, 10 minutes online). Open a business bank account — never commingle.

4. Buy daycare liability insurance

   A general liability policy plus a child-care endorsement runs $400–$1,200/year for a small home program, though cost varies widely by state and provider. Some homeowners insurers will cancel if they learn you run a daycare without disclosing it — call yours before you open.

5. Childproof and inspect the space

   Outlet covers, cabinet locks, gates at all stairs, anchored furniture, smoke and CO detectors on every level, fire extinguisher in the kitchen, locked medicine cabinet. Your licensing inspector will check all of these — do them first, not after.

6. Get certified and background-checked

   Commonly required: CPR and pediatric first aid, a TB test, fingerprint-based background check, and 10–40 hours of pre-service training — check your state's rules. Costs and timing vary by state; nothing else can move until these clear.

7. Set tuition based on local market

   Check published rates and your local child care resource and referral agency, or ask nearby providers directly. Price within $10/week of the average, as a starting point — going lower signals desperation; going higher needs a clear story. Many providers bill weekly in advance; choose a schedule and state it in your contract.

8. Write the parent handbook and contract

   Cover: hours, tuition, late fees, sick policy, vacation policy, termination, holidays, what to bring, photo/social media permission, emergency procedures. The contract is what protects you in disputes — don't skip it because the first family is your friend.

9. Set up enrollment paperwork and recordkeeping

   For each child: enrollment form, emergency contacts, signed contract and handbook, immunization records, allergy/medication forms, photo release, signed authorization for emergency medical care. Keep digital backups; your state may inspect records.

10. Market locally

    Local channels beat national directories for home daycares. Set up a Google Business Profile, post in 2–3 neighborhood Facebook groups, ask your pediatrician's office if you can leave a flyer, and list on free state child care referral sites. Ask satisfied families if they would recommend you.

A realistic 60-to-120-day timeline

• Weeks 1–2: Read state rules, decide capacity, form LLC, open bank account.
• Weeks 2–4: Submit licensing application, schedule background checks, start CPR/first aid course.
• Weeks 4–8: Childproof the space, buy supplies, write handbook, set tuition.
• Weeks 6–10: Licensing inspection, fire inspection, sanitation inspection.
• Weeks 8–12: Build Google Business Profile, post in local groups, hold open house, sign first contracts.
• Week 12+: License issued, first children start. Aim for a staggered start (one new family per week) for the first month.