Thursday, March 12, 2009
Child Care Expense
I ordered your book yesterday and can't wait till it arrives.
Question: My spouse and I deduct for child and dependent care expenses for our joint return. The care providers were out of the home, primarily day care or day camp facilities. I have also used someone to care for my children after school in our home, while I am working in my home office until my spouse gets home to take over the care. Is this expense deductible for my business. I wouldn't double count it of course for both my business and the child and dependent care expense IRS form 2441.
Doesn't matter where child care takes place -- in or out of the home. It is deductible on your tax return if both spouses have income and if it is legitimately paid. In other words paying the babysitter "off-the-books" does not get you a deduction.
Child care is not a business deduction.
Were you a corporation there are some provisions for deducting child care. However, child care alone is not a reason to incorporate.