Child Care Deduction

[SingleMomAZ]

Washington

Total child care approx. $4000
Annual income under $30,000
Business expenses: $250

Claiming one dependent and head of household.

Is it worth it to claim the child care?
By deducting child care and business expenses is it even going to bring me down a tax bracket or am I as low as it gets?

 

[davew128]

What happened when you ran the numbers?

 

[LdiJ]

Washington

Total child care approx. $4000
Annual income under $30,000
Business expenses: $250

Claiming one dependent and head of household.

Is it worth it to claim the child care?
By deducting child care and business expenses is it even going to bring me down a tax bracket or am I as low as it gets?

The child care credit is a very worthwhile credit to claim. And no, your income is not low enough that it wouldn't help you. It WILL help you.

 

[SingleMomAZ]

What happened when you ran the numbers?

If I knew, I wouldn't be asking.

The child care credit is a very worthwhile credit to claim. And no, your income is not low enough that it wouldn't help you. It WILL help you.

ok thanks!

 

[davew128]

If I knew, I wouldn't be asking.

Sigh. What happened when you looked at your tax return? Or read the instructions to the dependent care credit form? Or actually, I don't know, ran the numbers? Oh wait, you didn't do any of those prudent things.

 

[OHRoadwarrior]

Did they change the name to "Free Legal Advice and Tax Services"?

 

[davew128]

Did they change the name to "Free Legal Advice and Tax Services"?

Or as a departed member used to say "Hold up your tax return to the screen so I can see if you would have benefitted from the credit."

 

[LdiJ]

Sigh. What happened when you looked at your tax return? Or read the instructions to the dependent care credit form? Or actually, I don't know, ran the numbers? Oh wait, you didn't do any of those prudent things.

While I understand your point, I could tell, with just the numbers she gave, that she would benefit from the credit. Couldn't you? Or don't you normally do many lower income returns?

It pushes her to the point were she completely zeros out with regular tax, and shoves some of the child tax credit into the refundable additional child tax credit. So it gives her a benefit of over 800.00.

 

[davew128]

While I understand your point, I could tell, with just the numbers she gave, that she would benefit from the credit. Couldn't you? Or don't you normally do many lower income returns?

I've done returns (recently) with $30k AGI and zero taxable income....so no I can't look at the numbers as given and assume anything. All it would take is a mortgage payment and TI could have been zero for all I know, in which case there would have been no care credit.

 

[LdiJ]

I've done returns (recently) with $30k AGI and zero taxable income....so no I can't look at the numbers as given and assume anything. All it would take is a mortgage payment and TI could have been zero for all I know, in which case there would have been no care credit.

I have done 30k returns with zero taxable income too, but this one has only one dependent child and she didn't mention any itemized deductions. Also, it would be hard for someone with a 30k income to finance a mortgage high enough to take them over the 8400.00 HOH standard deduction...at today's interest rates.

 

[davew128]

Again, you're making assumptions. I've seen returns where that IS in fact the case.