Many parents who work or are looking for work must arrange for care of their children under 13 years of age during the school vacation. There are often possible tax deductions that can be taken advantge of for parents who put their children into some form of supervised care. If you paid a daycare center, babysitter, summer camp, or other care provider to care for a qualifying child under age 13 or a disabled dependent of any age, you may qualify for a tax credit of up to up to 35 percent of qualifying expenses of $3,000 for one child or dependent, or up to $6,000 for two or more children or dependents.
5 Tax Facts about Summertime Child Care Expenses
Here are five facts the IRS wants you to know about a tax credit available for child care expenses. The Child and Dependent Care Credit is available for expenses incurred during the lazy days of summer and throughout the rest of the year.
Summer Child Care Expenses that are Deductible
- The cost of day camp can count as an expense towards the child and dependent care credit.
- Expenses for overnight camps do not qualify.
- If your childcare provider is a sitter at your home or a daycare facility outside the home, you’ll get some tax benefit if you qualify for the credit.
- The actual credit can be up to 35 percent of your qualifying expenses, depending upon your income.
- 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.
Regardless of whether you paid for after-class child care during the school year or a week of day camp during summer break, you can apply the costs to the child and dependent care tax credit and use it to cut your tax bill at filing time. The child and dependent care tax credit is available to help offset the costs of providing care for children under age 13 while the child’s parents are working. If you work from home and you pay someone to watch your child so that you can get your work done, those expenses may qualify for the credit. Day camp expenses may also qualify for the credit, even if the camp is a “specialty camp,” such as a sports camp or a computer camp.
Almost everything that you bought in order to send your kid to camp is non-deductible. That includes:
- Sports equipment. It’s personal in nature and not deductible, even if it’s required.
- Clothing. Again, it’s personal in nature even if specifically required. And yes, even if those are clothes that your child would never, ever wear outside of camp.
- Fans and furniture for overnight camp. Still, personal in nature and not deductible.
Expenses involved in simply getting ready for camp are deductible. That includes:
- Physicals. The cost of a physical or well exam is deductible; you do not have to be sick in order for the visit to be deductible.
- Shots. Vaccines and immunizations are considered preventative care and are deductible.
- Fees for doctors. Most doctors charge a fee to complete forms for camp now. If those are part of your medical care, they are deductible.
Make sure you save receipts for camp and ask for the camp’s taxpayer identification number. You’ll need that number and the camp address to put on your tax return as substantiation of the expenses for the dependent care tax credit. Save the receipts as back up. For the workplace FSA, you need the camp address and a receipt or a signature of the camp director.
For more information, including rules for claiming this credit for your spouse or a dependent age 13 or over who is not able to care for himself or herself, check out IRS Publication 503, Child and Dependent Care Expenses. This publication is available below or by calling 800-TAX-FORM (800-829-3676).