My daughter did some babysitting in 2006 for a neighborhood kid. The parent of the kid just called asking for my daughter's SSN, or address, etc. so she can claim what she paid my 16 year old daughter. She says she can only claim what amounts she paid by check, which by her estimation, is about $600. She also assures my daughter that it won't matter to my daughter because she probably didn't earn enough to have to pay taxes.
Tell me what you think of that. I'll have to call our accountant tomorrow but I am wondering what people think about it tonight!
I doubt the parent. I don't think my daughter worked enough to earn $600. Also, shouldn't the parent provide my daughter with some sort of form/statement of what she is claiming she paid in a year?
2007-02-18 14:51:28 · 4 answers · asked by ssssss 4 in Business & Finance ➔ Taxes ➔ United States
It doesnt matter your daught obviously did not make 5150 so she therefore does not need to file taxes. Her employer just wants to claim the expenses as dependent care expenses on her Schedule A....if she has the checks to prove it then she can deduct it...i'm not sure about the ssn you shouldnt have to give that...your daughter does not need a statement like a w-2 becuase she made so little...
2007-02-18 14:58:49 · answer #1 · answered by Anonymous · 0⤊ 1⤋
Assuming your daughter has no unearned income (meaning, interest income, etc.), she would not have to file unless she made more than $5,150. The parent needs your daughter's SS# in order to get a dependent care credit on her own return. This can be very valuable to her and probably would not impact your daughter at all unless she was making a small fortune by caring for this parent's child(ren). The parent does not have to provide any documentation to your daughter. One last item to note is that the parent is only supposed to claim the dependent care credit for care that enabled him/her to work. So if this was evening babysitting while the parent(s) went out to dinner or a movie, etc., technically it would not qualify for the credit. This shouldn't mean much to your daughter unless the parent was claiming an amount so large it would force your daugther to file a return.
2007-02-19 00:09:26 · answer #2 · answered by Lilly 3 · 0⤊ 0⤋
She can't just guess what she paid her - she'd have to be able to substantiate it. If she has the checks, she shouldn't have to be estimating, she should be able to add them up.
Babysitting is only deductible if it was to enable the parent to work, not for evening sitting so they could go out to dinner and a movie or something like that.
If your daughter earned over $400 from self-employment, she'd pay a 15.3% unemployment tax on her earnings, although the neighbor is right that she probably wouldn't owe any income tax.
2007-02-19 00:06:05 · answer #3 · answered by Judy 7 · 0⤊ 0⤋
your daughter doesnt have to file either way, so it really doesnt matter if she gets a 1099 or not. she didnt earn enough money.
but the neighbor wants to claim child and dependent care credit, and needs to provide your daughters name and SS# on Form 2441. Its up to you whether you want to provide that info or not.
2007-02-18 23:18:53 · answer #4 · answered by tma 6 · 0⤊ 1⤋