During the summer months while children are not in school and parents are at work, it may be necessary to find child care for those under age 13. There is a tax credit that can be filed to aid in the additional cost burden brought on by this expense. To ease the process of applying for this credit, it is a good idea to collect the necessary information throughout the year. By filing IRS Form 2441 along with your type 1040 tax return, a taxpayer can receive credits for the expense of hiring someone to care for their child while they work. This is the same form that is used for dependent care expenses, such as when one cares for a disabled spouse or dependent.
Some employers directly pay for dependent care and reduce salary to provide these care benefits. These are also tax deductible and the amounts can be found in one’s W-2 forms at the end of the year. When filling out the IRS Form 2441, it is important to have information from the people or companies providing the care. It is considered prudent to fill out a W-10 form during the care period so that the information will be ready and at hand when filing. If for some reason this information is not available or not provided, an explanation must be attached to the form when filing.
There are exceptions for eligibility to file IRS Form 2441. One is that parents with children over 13 years of age do not qualify. For dependent adults, they cannot earn over $3800 in gross income. They also cannot have filed a joint return or be claimed as a dependent by any other taxpayer.
Being prepared to file a return sometimes requires a bit of forethought. Having records is important for filing IRS Form 2441 or any other IRS form. It is best to be careful when filling out tax forms as mistakes can turn out to be costly; either by losing out on money or plunging one into tax debt. For questions or help on filling out IRS Forms or just to ask questions on taxes, it is always good to consult an experienced tax professional.