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re: Please help me understand childcare write offs
Posted on 1/21/15 at 11:29 am to StringedInstruments
Posted on 1/21/15 at 11:29 am to StringedInstruments
quote:
That's about $56k a year spent without food, utilities, transportation, insurance, etc.
Thankfully my wife's car is paid off and I have a company car and don't pay anything. I've unfortunately had to pull back the rein's on my 401k to help afford this and still give us some money. I think we'll only be able to keep this up for 1 year and then we're out. More than half of our take home pay is going to just rent/daycare.
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Posted on 1/21/15 at 1:06 pm to CHiPs25
quote:
I'm not sure if either of our companies offers a dependent care plan but we're definitely going to find out.
If you don't, ask if they can start one.
When I moved back to LA a few years ago, my new firm didn't have one. I had one when I worked in Texas. So I went to our HR people and asked if they could start one. They talked to their benefits people and apparently there wasn't really any cost to offer it. So now we have one and a few of us here use it. But we don't get a card or anything... we have to pay for the child care with other funds and get reimbursed monthly.
Posted on 1/21/15 at 1:15 pm to CHiPs25
What do you and your wife do? Could she stay home and take care of the kid? Also, would you consider buying? At least that money would be going toward equity and not to a landlord.
Posted on 1/21/15 at 1:29 pm to PeterPeterP
quote:
What do you and your wife do? Could she stay home and take care of the kid? Also, would you consider buying? At least that money would be going toward equity and not to a landlord.
Unfortunately we need her income to survive. She's in sales so some months her take home is extremely good and other times it's not. We take the good months and put extra to the side in order to pay for the not so good months.
Owning is not a possibility at this point. Our long term plans don't include living in Chicago or even Illinois for that matter because of how expensive it is. We probably have 1 year left in this city and then it's back to the cheap south.
Posted on 1/21/15 at 9:14 pm to CHiPs25
quote:
We probably have 1 year left in this city and then it's back to the cheap south.
Yeah, good call. My wife and I paid around $410/wk for two kids a couple of years back, and it was definitely straining. The good new is, if you're near good public schools, you'll get a sweet raise in about 5 years.
Posted on 1/28/15 at 12:57 pm to Dirtman16
I paid $10/kid/day, she fed them and never ever called sick.
Posted on 1/28/15 at 1:32 pm to ConfusedHawgInMO
10 bucks a day? Kinda fricked up, no?
Posted on 1/28/15 at 2:06 pm to castorinho
I have a quick off shoot question. I have my kid at my office in lieu of paying for daycare. Would there be a way to bill my office for the service to receive the tax credit on the other end?
Posted on 1/28/15 at 2:39 pm to autodd03
quote:
I have my kid at my office in lieu of paying for daycare. Would there be a way to bill my office for the service to receive the tax credit on the other end?
Do you mean your kid sits in the cube with you, or, your company has an on-site day care facility?
Posted on 1/28/15 at 3:06 pm to LSUFanHouston
I am self employed as an insurance agent and have an extra room in my office space that is currently designated as a nursery. I also have a retired family member stop by during most days and "entertain" the child for a few hours.
Posted on 1/28/15 at 3:16 pm to autodd03
You can only take the credit for costs paid to a person or entity to take care of the child. To claim the credit, you need to provide the name and EIN/SSN of the provider.
This is why, for example, if you pay someone "under the table" to watch the kids, you can't get the credit.
It doesn't sound like you are paying anyone. And even if you did pay "rent" for the room to your agency... you would need to put the agency EIN and they should report it as rent income.
Honestly, be glad for your situation.
This is why, for example, if you pay someone "under the table" to watch the kids, you can't get the credit.
It doesn't sound like you are paying anyone. And even if you did pay "rent" for the room to your agency... you would need to put the agency EIN and they should report it as rent income.
Honestly, be glad for your situation.
Posted on 1/28/15 at 3:27 pm to LSUFanHouston
Thank you for the advice. Obviously I am looking for anyway to reduce my tax burden like everyone else. Sounds like it would be a tad risky and not provide too much benefit after having to pay tax on an extra $3k "income" to my business.
Posted on 2/3/15 at 1:46 pm to castorinho
I called it a blessing.
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