All across the country kids are getting out of school for the sweet taste of summer freedom! Maybe you’re happy for your kids and their 3 months off to play and have some fun, but you might find yourself stressed out because you have to pay for some form of care for them over the summer, but don’t worry, you can actually claim child and dependent care expenses on your Income Tax Return.
If you’re busy working and need to pay for care you may qualify for a credit for up to 35% of the care expenses for your child or dependent under the age of 13 or for your dependent or spouse if they are unable to physically or mentally care for them self. To claim this credit you must qualify for it and claim it on Form 1040, 1040A, or 1040NR.
You qualify for the credit if you have earned income during the year or if you’re looking for work. However, you’ll need to have a job or have earned income before you file your return. Also, if you’re married or filing jointly then your spouse will need a job or to be looking for work as well.
The care expenses must be paid to allow you and your spouse to work or look for work. If you only looked for work or worked during a part of the year then you must prorate the expenses. You can’t claim the credit for any periods of 2 weeks or longer when you were not working or looking for work.
Unfortunately stay at home parents do not qualify. Although, if your spouse is a full-time student enrolled for 5 months of the year or they are unable to care for themselves mentally or physically and live with you for over half of the year then they qualify. Your child must live with you for more than half of the year to qualify as well.
The care payments can’t be made to anyone you or your spouse can claim as a dependent, your spouse, or the parent of your qualifying person if they’re your children and if they’re 13 or older. You can pay your kid for care if you don’t claim them as a dependent and they’re 19 or older or will turn 19 by the year’s end.
If your child turns 13 during the time that care was provided you can still claim the credit for the time during the year when your child was younger than 13.
If You Filed An Extension For Form 1040
If you needed an extension to file your Income Tax Return then you now have until October 17th to complete your return. This gives you more than enough time to read up on the specific requirements for the Dependent Child and Care Expenses Credit. You can always ask a local tax preparer for assistance.
We hope you have some fun vacations planned for you and your children or dependents this summer. Don’t stress out about their cost of care, see if they qualify for a credit to save a little on your return!
For more tax blogs visit ExpressExtension.com and please share your tips about the Child and Care Expenses Credit in the comment section below.