Not All Parents Know Child Care Is Tax Deductible
Since not all parents know that the money they pay for child care can be applied to their taxes, you can make your facility an even more valuable asset to them by letting them know. Simply copy and hand out the pertinent parts of this article.
According to the Internal Revenue Service, the Child and Dependent Care tax credit applies to child care, day care, summer camps and after-school programs.
In order to claim the child-care tax credit:
You and your spouse must have received earned income during the year.
The child care must be work related. That means that child care was necessary in order for you or your spouse to work or look for work.
The credit is non-refundable --that is, it can only reduce a family's income tax liability to zero; any additional credit is lost.
Regardless of when you paid for child care during the tax year, you can apply those costs toward this credit to cut down on your tax bill.
The best place to quickly learn all you need to know about the Child and Dependent Care Credit is the IRS itself.