I was wondering if you can deduct amounts paid to a daycare from your gross income when doing your federal income taxes. Also, if yes, do you have to itemize in order to claim that deduction or can you use the standard deduction and then use that expense on top of that?
2007-05-14 02:07:56 · 9 answers · asked by Sunshine528 2 in Business & Finance ➔ Taxes ➔ United States
You can claim daycare expenses as a credit on your tax return, they are claimed on form 2441 - Child and Dependent Care expenses. They are independent from either itemizing or taking the standard deduction, but you have to have taxable income and income tax in order to get the credit. Also, if you are single, the single person has to have earned income or by physically or mentally incapable of caring for the person qualifying for the credit. If married, both persons have to have earned income, or if one has earned income, the other has to be physically or mentally incapable of caring for the person qualifying for the credit. Also, if the person who is being cared for is a minor child, the credit ends when the child turns 13, but you can claim child care expenses paid up till the child turns 13. I have listed the irs instructions for form 2441.
2007-05-14 02:21:10 · answer #1 · answered by Anonymous · 1⤊ 3⤋
Any expenses for child care by someone other than your spouse or the child's parent is reimburseable. If you received any reimbursement through an employer sponsored flexible spending/child care account that is not deductible. You have to get a statement from the care provider with their tax id # on it.
2016-05-17 21:57:51 · answer #2 · answered by concetta 4 · 0⤊ 0⤋
You do not have to itemize. On form 1040 or 1040A you fill out a form 2441 and depending on your gross income you get a direct tax credity type deduction. Go to IRS.GOV and in the forms order section download a 2441 and examine it; it is self explanatory.
2007-05-14 04:54:31 · answer #3 · answered by acmeraven 7 · 0⤊ 3⤋
You don't deduct the daycare expenses. If you owe tax, you may get a credit to reduce that tax by filing Form 2441 Child and Dependent Care Expenses. You may receive a credit of between 20% and 35% of your expenses up to $3,000 per child (for up to two children).
These expenses have to be paid by you so that you and your spouse can work or look for work. There are also provisions for the credit of one of the spouses is a full-time student or disabled.
http://www.irs.gov/pub/irs-pdf/f2441.pdf
2007-05-14 02:17:23 · answer #4 · answered by ninasgramma 7 · 3⤊ 4⤋
It's better than a deduction, it's a credit, and no, you don't have to itemize to take it.
It's called the child and dependent care credit, and is claimed by filing form 2441. Download the form, and also Publication 503, at irs.gov for details.
2007-05-14 02:38:00 · answer #5 · answered by Judy 7 · 2⤊ 3⤋
Child Care expenses can be taken as a credit on your Federal Taxes Using Form 2441, this credit reduces your tax liability. The money paid for child care expenses must be paid to enable you and your spouse to work. babysitting expenses for a night out do not qualify.
You need to have accurate records and submit form 2441 with your return.
http://www.irs.gov/instructions/i2441/index.html
http://www.irs.gov/pub/irs-pdf/f2441.pdf
2007-05-14 02:17:39 · answer #6 · answered by stuart 3 · 3⤊ 3⤋
yes, it is a deduction
no, you don't deduct from gross income
no, you don't have to itemize
the deduction goes on form 2441
it gives you a tax credit, used against any tax you might owe
yes you can use standard deduction and claim the credit also
Child care up to $3,000. can be claimed for a child under the age of 13. You will not get a 100% dollar for dollar deduction but after going through the form you will get a tax credit. A tax credit is used against tax you owe but this one is not a refundable credit like earned income credit is.
The day care will give you a form at end of year with the amount you paid and will have their address and EIN number. These things will be needed to fill out the form 2441.
Also, although you didn't ask, you may be eligible to claim the child tax credit for a child under the age of 16, here's a link to pub 972.
http://www.irs.gov/pub/irs-pdf/p972.pdf
information
http://www.irs.gov/taxtopics/tc602.html
wow! someone gave me a thumbs up, thanks.
2007-05-14 02:14:52 · answer #7 · answered by Jo Blo 6 · 1⤊ 8⤋
You can claim childcare expenses on a 1040 or 1040A form, so the answer is yes and no. Yes you can claim (a percentage) and no, you do not have to itemize.
2007-05-14 02:15:36 · answer #8 · answered by Midnight 2 · 2⤊ 3⤋
every year my daycare gives my a ytd form with there tax ID and I get a certain percentage back from it on my taxes
2007-05-14 02:15:24 · answer #9 · answered by lisamarie7901 5 · 2⤊ 2⤋