I want to have my mother in law watch my child, but we need to know if we claim on our taxes does she have to claim the income on hers
2007-08-07 05:29:31 · 4 answers · asked by Bob J 1 in Business & Finance ➔ Taxes ➔ United States
Yes, if you claim the child care expenses, then she has to claim the child care income. She is supposed to claim the income whether or not you claim the deduction, but if you don't report the child care expenses to the irs they have no way of knowing that you paid her. To claim the child care credit, you have to put down the child care provider's name, address, and social security/EIN #. That would be what the irs would use to know that your mother-in-law would have to report the income.
2007-08-07 05:32:09 · answer #1 · answered by Anonymous · 4⤊ 0⤋
Whether you claim it on your taxes or not, she MUST report it on hers.
If you do claim the Child & Dependent Care Credit the IRS will know about the payments to her for certain since you have to provide her SSN or TIN. However even if you don't or can't claim the credit she is still legally obligated to report the income and pay any tax due.
2007-08-07 12:31:57 · answer #2 · answered by Bostonian In MO 7 · 6⤊ 1⤋
Yes. Legally, whether you claim the child care credit or not, she is required to claim it as income.
2007-08-07 12:50:30 · answer #3 · answered by Judy 7 · 4⤊ 0⤋
yes
2007-08-07 12:36:25 · answer #4 · answered by island3girl 6 · 3⤊ 0⤋