Home Members Tools Credit Cards
   

  • Child and Dependant Care Credit 2009

    Facts about the Child and Dependant Care Tax Credit 2009
    If you paid someone to care for your child, spouse, or dependant so that you or your spouse could work or look for work, you may be able to reduce your tax by claiming the Child and Dependant Care Credit on your federal tax return.

    Below are the top things to know about taking the child and dependant care credit:

    • You must have paid for care for one or more qualifying persons. A qualifying person is your dependant child under age 13. Also, your spouse and certain other individuals who are mentally or physically unable to care for themselves may also be qualifying persons. You must identify each qualifying person on your tax return.

    • The care must be provided so that you and your spouse could work. Full-time or part-time positions qualify as work.Actively looking for work also qualifies as work, but you must have earned income for the year to take the credit. For example, if you pay for child care while looking for work but do not find a job, you cannot take the credit if you have no earned income for the year.

    • Earned income is considered to be wages, salaries, tips, or income from self-employment. Income from pensions, social security, worker's compensation, interest and dividends, unemployment benefits, child support and alimony, nontaxable workfare payments, income earned while an inmate in prison are not considered to be earned income.

    • You, and your spouse if married, must have earned income or net earnings from self-employment. One spouse may be considered as having earned income if they were a full-time student, or if they were physically or mentally unable to care for themselves.

    • You must identify the care provider on your tax return. The care provider cannot be your spouse, someone you can claim as your dependant on your tax return, or your child under age 19 even if the child is not your dependant. The care provider cannot be your child's other parent if the child is under age 13. However, a person who is your relative but not your dependant may be a qualifying care provider even if they live in your home.

    • Individuals whose tax status is married filing separately cannot take the child and dependant care credit. Your filing status must be single, married filing jointly, head of household, or qualifying widow or widower with a qualifying child.

    • The qualifying child must have lived with you for more than half of the tax year. A spouse or other dependant who is disabled must also live with you for more than half of the tax year.

    • The credit can be for up to 35% of your qualifying expenses, depending on your income. The credit for those who have an adjusted gross income of $15,000 or less can take the full 35% as long as the credit doesn't exceed the maximum dollar amount discussed below. The credit is reduced by one percentage point for each additional $2000 increment of AGI. The credit is 20% for taxpayers whose AGI is more than $43,000.

    • For tax year 2008, you can use up to $3,000 of expenses for one qualifying individual or $6,000 for two qualifying individuals, depending on your income. But the amounts don't have to be divided equally among your qualifying dependants. For example, if one child's care is $2800 and the other child's care is $3200, you may still take the full $6000 credit. The qualifying expenses must be reduced by the amount of any dependent care benefits provided by your employer that you exclude from your income.

    • If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer. If you are a household employer, you may have to withhold and pay social security and Medicare tax and pay federal unemployment tax. Usually, you are not considered a household employer if the care provider works from their own home or business. For information, see Publication 926, Household Employer's Tax Guide.
      For more information on the Child and Dependent Care Credit, see Publication 503, Child and Dependent Care Expenses. You may download these free publications from www.IRS.gov or order them by calling 800-TAX-FORM (800-829-3676).

    IRS Links:
    Publication 503, Child and Dependent Care Expenses (PDF 167K)
    Form W-10, Dependent Care Providerís Identification and Certification (PDF 31K)
    Form 2441, Child and Dependent Care Expenses (PDF)
    Form 2441 Instructions (PDF 32K)
    Publication 17, Your Federal Income Tax (PDF 2,075K)
    Tax Topic 602


    Disclaimer: This article is intended for informational purposes only; please check out the IRS website or seek a competent tax professional if you need further assistance with your personal tax situation.

    Source:
    Internal Revenue Service
  • Disclaimer

    Information in these articles is brought to you by Finance Globe. Banks, issuers, credit card, and other companies mentioned in the articles do not endorse or guarantee, and are not responsible for, the contents of the articles and is further subject to our terms and conditions.
  • Recent Activity

    ryanna09

    pre approve credit card

    Thread Starter: ryanna09

    Trying to apply for credit card walmart credit card

    Last Post By: Wanderer November 27th, 2014, 11:04 AM Go to last post
  • Recent Forum Posts

    Wanderer

    Re: pre approve credit card

    In my reading some writers have said an in store application really works. My app was online so I can't say. It appears Walmart is more flexible with

    Wanderer November 27th, 2014, 11:04 AM Go to last post
    ryanna09

    Re: pre approve credit card

    Tying to rebuild my credit score and how to manage. Thanks to comienty bank, I now have a vc,express and capital one master card

    ryanna09 November 27th, 2014, 06:06 AM Go to last post
    ryanna09

    pre approve credit card

    Trying to apply for credit card walmart credit card

    ryanna09 November 27th, 2014, 05:59 AM Go to last post
    ryanna09

    Re: Updating a Credit Card Status

    Trying to apply for wwalmart credit card

    ryanna09 November 27th, 2014, 05:52 AM Go to last post
    Finance Globe

    Re: Happy Thanksgiving!

    Have a happy Thanksgiving everyone. Please be safe and remember all that there's to be thankful for. So much going on in our country, and in the world

    Finance Globe November 25th, 2014, 02:28 AM Go to last post
  • Recent Headlines and Articles

    ChrisB

    Ways for College Students to Earn Money over the Holiday Break

    As a college student, there is nothing more exciting than a long holiday break. This gives you the opportunity to refresh your mind, ensuring that you are ready to hit the ground running when the new year... read more
    ChrisB November 25th, 2014, 09:40 AM
    ChrisB

    Avoid these Holiday Spending Mistakes

    Now that the holiday shopping season is in full swing, it is time for you to hit local and online stores to find the best deals. While doing so, it is imperative that you have a strong grip on your finances.... read more
    ChrisB November 24th, 2014, 10:04 AM
    ChrisB

    Donít Fall Prey to these Holiday Shopping Scams

    With the holiday shopping season upon us, it is likely that you have your list in hand, money in your pocket, and a plan for finding everything you want and need.... read more
    ChrisB November 21st, 2014, 10:34 AM
    ChrisB

    3 Black Friday Shopping Tips to Follow

    In a few short days, Black Friday will be upon us. While many people will shy away from stores, others will dive in headfirst in search of the best deals.

    If you plan on braving the large crowds, here are... read more
    ChrisB November 20th, 2014, 09:18 AM
    ChrisB

    How to Save Money on Office Communication

    As a small business owner, even a one-man show, you know there are many expenses that come up over the course of a month. While there is nothing wrong with ďspending money to make money,Ē you... read more
    ChrisB November 19th, 2014, 09:38 AM
    ChrisB

    Overlooked Ways to Save on the Cost of a New Car

    Many people believe there is only one way to save on the cost of a new car: compare dealers until you find the cheapest deal.

    While this is a great place to start, there are other... read more
    ChrisB November 17th, 2014, 10:24 AM
    ChrisB

    What is Stopping you from Saving More Money?

    Regardless of your financial situation, if you are like most people you share one common goal: to save as much money as possible.

    While some are able to do so with success, feeling comfortable with their progress, others... read more
    ChrisB November 13th, 2014, 09:50 AM
  • Recent Article Comments

    Wanderer

    Donít Fall Prey to these Holiday Shopping Scams

    Very appropriate warning. Thanks for giving us a "heads up"! Go to last post

    Wanderer November 22nd, 2014 04:38 AM

 

 

 

Credit Cards | Finance Social Network | Credit Card Reviews | Markets
About Us | FG on the Web | Sitemap | Privacy | Terms | Contact


Copyright © 2014 Finance Globe. All rights reserved.