My daughter is 2 years old. Last year, I didn't claim any childcare credit because my mom was the caregiver, and it wouldn't make any sense to deduct the amount and add it to her tax bill.
This year, we will be sending her to a daycare center that charges around $1200 a month. Do I need to get their tax id in order to claim it, or can I just put down their official name and address to claim it? Thanks.
2007-05-17 18:39:53 · 5 answers · asked by jveryrad 4 in Business & Finance ➔ Taxes ➔ United States
Most centers will give you a form that you can use for your taxes. It will show them and their id, as well as your info and what you paid for care. Ask about it now to reassure your concerns.
2007-05-17 18:47:46 · answer #1 · answered by Anonymous · 3⤊ 0⤋
Bostonian is correct for the most part. Daycare providers are required by law to provide the tax ID number. There are penalties if they don't. You don't, however, need to have the EIN or SS number to file for the child care credit. You can file using "Refused" or "Unable" where the number goes. You would have to mail the return in and not e-file the return. The IRS would probably contact the provider for the information and also impose penalties.
Link to 2441 Instructions:
http://www.irs.gov/pub/irs-pdf/i2441.pdf
2007-05-18 09:23:15 · answer #2 · answered by Mark S 5 · 1⤊ 0⤋
at the end of the year daycare centers usually give a wage form showing what you paid them in total for the year as well as their EIN. Also it is possible that if you go to a pro to get it done and they have other clients that use this daycare center they will have the EIN, but be cautious doing this as you do not want to file using less or more than you actually paid.
2007-05-18 09:12:47 · answer #3 · answered by reciprocityabound 3 · 1⤊ 0⤋
You need IRS Form 2441; upon which you have to put down the name of caregiver, address, and identifying number; either social security or EIN. There is a dollar limit per child also upon which the credit is based.
2007-05-18 11:03:21 · answer #4 · answered by acmeraven 7 · 0⤊ 0⤋
Two issues here.
First off, whether you claim the credit for money paid to your mother does NOT absolve her of the requirement to report the income and pay any taxes on it! These are two separate issues. Her failure to report the income constitutes tax evasion. If the IRS should catch wind of it, she could be in serious trouble with the law.
Second, the provider MUST give you their tax ID number (SSN, EIN, etc.) for you to claim the credit. Professional providers -- commercial day care centers -- are aware of this requirement and will willingly give you the numbers. Many will also provide you with a statement at year-end of how much you paid them although they are under no obligation to do so.
2007-05-18 03:07:13 · answer #5 · answered by Bostonian In MO 7 · 2⤊ 3⤋