The child and reliant care credit is intended to offset the cost of child or dependent care so that you and your spouse, if you are wedded, may work or look for work. The credit is usually planned as a proportion
of the work-rela
ted fixed cost you incurred for care. Your AGI determines the fraction of the expenses you may claim.
To claim the recognition, you must be paying the operating cost for a person who qualifies under Internal Revenue Service system. Your dependent must be a qualifying child who is under 13 or a needy who is unable of caring for himself — either spiritually or physically — and who has lived with you more than half the year. For the reasons of this tax credit, the dependent’s gross income or tax position is not well thought-out, and neither is your dependent position. You may claim the credit if these experience are fulfilled, even if you may be claimed as a dependent on someone else’s return.
Caregiver Qualifications and Filing Requirements
You may not maintain the credit if the caregiver is somebody you — or you and your spouse if you are married — may claim as a dependent, is your child who is under 19, or is not your spouse or the parent of the dependent child. You must file together if you are married. You must provide the taxpayer identification number of the dependents you are claiming. You must also supply the taxpayer identification number of the caregiver.
Earned Income Test
In order to meet the criteria for this credit you — and your spouse if you are married — must have earned income. For this credit, earned income includes earnings, salaries, tips, other taxable worker recompense, net earnings from self-employment, strike settlement and any disability pay you report as income. You may select by ballot to use nontaxable combat pay, but generally only taxable income is included.
The expenses for care must be straight related to your work, or your capability to look for work. For instance, if you work days and your husband works nights and sleeps while you’re at work, paying a sitter so your husband can sleep is work-related. If you work part-time or seasonally, it qualifies as work-related, but your operating cost must be calculated for that reason. If you work part-time your operating cost is eligible, but only for the days you work. Working at least one hour counts as a day of work.