Skip to main content

At some stage we were all kids and even our own children may forever be referred to as our kids.  When it comes to taxes, we wish we could claim them forever while at the same time not being aware of different age milestones.  Being asked if you have any childcare expenses is something that many will only think of ends after their kids attend kindergarten or a higher grade.  Yet the Child and Dependent Care tax credit is available for children or another member of the household for care if they are under the age of 13 when the care is provided!  For tax year 2022 this means that you will get a tax credit of up to $3,000 for one qualifying individual or $6,000 for two or more qualifying individuals.  You may no longer get to deduct kindgerten butt there are other expenses that may still qualify including before/aftercare as well as daycamps over the summer.  Here is an example directly from IRS Publication 503 for child and dependent care expenses on page 8 of the 2022 version:

Example. You pay a housekeeper to care for your 9-year-old and 14-year-old children so you can work. The housekeeper spends most of the time doing normal household work and spends 30 minutes a day driving you to and from work. You don’t have to divide the expenses. You can treat the entire expense of the housekeeper as work related because the time spent driving is minimal. Nor do you have to divide the expenses between the two children, even though the expenses are partly for the 14-year-old child who isn’t a qualifying person, because the expense is also partly for the care of your 9-year-old child, who is a qualifying person. However, the dollar limit (discussed later) is based on one qualifying person, not two.

That is an example of the IRS being extremely generous when it comes to child and dependent care expenses!

Don’t miss out on these valuable credits that are often overlooked.  Follow us on your preferred social media platform to stay in touch with other helpful tips in the world of taxes and personal finance.  If you feel you would benefit from a consultation, please feel free to fill out this form so that we can get in touch with you.