Remember the Child and Dependent Care Tax Credit When Making Summer Plans

During the summer many parents may be planning the time between school years for their children while they work or look for work.
 
 
Safe Harbor Child Tax Credit
Safe Harbor Child Tax Credit
 
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July 11, 2012 - PRLog -- Safe Harbor Accounting wants to remind taxpayers that are considering their summer agenda to keep in mind a tax credit that can help them offset some day camp expenses.


•   Your child or dependent must meet certain qualifications,

•   Your daycare provider must meet certain qualifications,

•   You must have earned income,

•   The care provided must enable you to work or to look for work, and

•   You must reduce your eligible daycare expenses by any amounts provided by a  
       dependent care benefits plan through your employer.


The Child and Dependent Care Tax Credit is available for expenses incurred during the summer and throughout the rest of the year. Here are some facts the we want you to know about the credit:

1. Children must be under age 13 in order to qualify.

2. Taxpayers may qualify for the credit, whether the childcare provider is a sitter at home or a daycare facility outside the home.

3. You may use up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit.

4. The credit is on a sliding scale in accordance with wages. The child and dependent care tax credit is worth 20% to 35% of your day care expenses. The credit is phased out
to 20% as income goes higher.

5. Expenses for overnight camps or summer school/tutoring do not qualify.

6. Save receipts and paperwork as a reminder when filing your 2012 tax return. Remember to note the Employee Identification Number (EIN) of the camp as well as its location and the dates attended.

7. The cost of sending your child to an overnight camp is not considered a work-related expense.

8. A daycare program can include a wide variety of activities geared to children's needs and interests. The cost of sending your child to a day camp may be a work-related expense, even if the camp specializes in a particular activity, such as computers or soccer.

The preceding information is not intended to replace the services of a professional. Consult a CPA or an Attorney who can better understand your particular circumstances.

Please contact us http://safeharboraccounting.com/
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Tags:Tax Prep, Tax Filing, Tax Service, Tax Preparer, Income Tax
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