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How To File State Taxes

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How To File State Taxes

How to file state taxes Index A Alimony paid, Alimony paid. How to file state taxes Alimony received, Alimony received. How to file state taxes Annulment, Divorce or separation. How to file state taxes Assistance (see Tax help) B Basis of property, death of spouse, Death of spouse. How to file state taxes Business expenses, Business and investment expenses. How to file state taxes C Child tax credit, Child tax credit. How to file state taxes Civil service annuities, Civil service retirement. How to file state taxes Community income defined, Community or Separate Property and Income Community income, special rules, Certain community income not treated as community income by one spouse. How to file state taxes Community property defined, Community or Separate Property and Income Community property laws disregarded, Community Property Laws Disregarded Credits Child tax credit, Credits, Taxes, and Payments Earned income credit, Earned income credit. How to file state taxes CSRS annuities, Civil service retirement. How to file state taxes D Death of spouse, basis of property, Death of spouse. How to file state taxes Deductions Alimony paid, Deductions Business expenses, Deductions Investment expenses, Deductions IRA deduction, Deductions Personal expenses, Deductions Dependents, Exemptions Dividends, Dividends, interest, and rents. How to file state taxes Divorce, Divorce or separation. How to file state taxes Domestic partners, Registered domestic partners. How to file state taxes Domicile, Domicile E Earned income credit, Earned income credit. How to file state taxes End of the marital community, End of the Community Equitable relief, Equitable relief. How to file state taxes ESA withdrawals, Withdrawals from individual retirement arrangements (IRAs) and Coverdell Education Savings Accounts (ESAs). How to file state taxes Estimated tax payments, Estimated tax payments. How to file state taxes Exempt income, Tax-exempt income. How to file state taxes Exemptions Dependent, Exemptions Personal, Exemptions Extensions, Extension of time to file. How to file state taxes F FERS annuities, Civil service retirement. How to file state taxes Form 8958, Community or Separate Property and Income, Identifying Income, Deductions, and Credits, Dividends, interest, and rents. How to file state taxes , Separate Return Preparation Free tax services, Free help with your tax return. How to file state taxes G Gains and losses, Gains and losses. How to file state taxes H Help (see Tax help) I Income Alimony received, Income Civil service annuities, Income Dividends, Income Gains and losses, Income Interest, Income IRA distributions, Income Lump-sum distributions, Income Military retirement pay, Income Partnership income, Income Pensions, Income Rents, Income Separate income, Income from separate property. How to file state taxes Tax-exempt income, Income Wages, earnings, and profits, Income Innocent spouse relief, Relief from liability arising from community property law. How to file state taxes , Equitable relief. How to file state taxes Interest, Dividends, interest, and rents. How to file state taxes Investment expenses, Business and investment expenses. How to file state taxes IRA deduction, IRA deduction. How to file state taxes IRA distributions, Withdrawals from individual retirement arrangements (IRAs) and Coverdell Education Savings Accounts (ESAs). How to file state taxes J Joint return vs. How to file state taxes separate returns, Joint Return Versus Separate Returns L Lump-sum distributions, Lump-sum distributions. How to file state taxes M Military retirement pay, Military retirement pay. How to file state taxes N Nonresident alien spouse, Nonresident alien spouse. How to file state taxes O Overpayments, Overpayments. How to file state taxes P Partnership income, Partnership income. How to file state taxes Partnerships, self-employment tax, Partnerships. How to file state taxes Payments Estimated tax payments, Estimated tax payments. How to file state taxes Federal income tax withheld, Federal income tax withheld. How to file state taxes Pensions, Pensions. How to file state taxes Personal expenses, Personal expenses. How to file state taxes Publications (see Tax help) R Registered domestic partners, Registered domestic partners. How to file state taxes Relief from liability arising from community property law, Relief from liability arising from community property law. How to file state taxes Rents, Dividends, interest, and rents. How to file state taxes S Self-employment tax Partnership, Self-employment tax. How to file state taxes Sole proprietorship, Self-employment tax. How to file state taxes Separate income defined, Separate income. How to file state taxes Separate property defined, Community or Separate Property and Income Separate property income, Income from separate property. How to file state taxes Separate returns Extensions, Extension of time to file. How to file state taxes Separate returns vs. How to file state taxes joint return, Joint Return Versus Separate Returns Separated spouses, Spouses living apart all year. How to file state taxes Separation agreement, Divorce or separation. How to file state taxes Sole proprietorship, self-employment tax, Sole proprietorship. How to file state taxes Spousal agreements, Spousal agreements. How to file state taxes Spouses living apart, Spouses living apart all year. How to file state taxes T Tax help, How To Get Tax Help Tax-exempt income, Tax-exempt income. How to file state taxes TTY/TDD information, How To Get Tax Help W Wages, earnings, and profits, Wages, earnings, and profits. How to file state taxes Withholding tax, Federal income tax withheld. 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The How To File State Taxes

How to file state taxes 32. How to file state taxes   Child and Dependent Care Credit Table of Contents Reminders Introduction Useful Items - You may want to see: Tests To Claim the CreditQualifying Person Test Earned Income Test Work-Related Expense Test Joint Return Test Provider Identification Test How To Figure the CreditFiguring Total Work-Related Expenses Earned Income Limit Dollar Limit Amount of Credit How To Claim the CreditTax credit not refundable. How to file state taxes Employment Taxes for Household Employers Reminders Taxpayer identification number needed for each qualifying person. How to file state taxes  You must include on line 2 of Form 2441 the name and taxpayer identification number (generally the social security number) of each qualifying person. How to file state taxes See Taxpayer identification number under Qualifying Person Test, later. How to file state taxes You may have to pay employment taxes. How to file state taxes  If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer who has to pay employment taxes. How to file state taxes Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. How to file state taxes See Employment Taxes for Household Employers , later. How to file state taxes Introduction This chapter discusses the credit for child and dependent care expenses and covers the following topics. How to file state taxes Tests you must meet to claim the credit. How to file state taxes How to figure the credit. How to file state taxes How to claim the credit. How to file state taxes Employment taxes you may have to pay as a household employer. How to file state taxes You may be able to claim the credit if you pay someone to care for your dependent who is under age 13 or for your spouse or dependent who is not able to care for himself or herself. How to file state taxes The credit can be up to 35% of your expenses. How to file state taxes To qualify, you must pay these expenses so you can work or look for work. How to file state taxes This credit should not be confused with the child tax credit discussed in chapter 34. How to file state taxes Dependent care benefits. How to file state taxes   If you received any dependent care benefits from your employer during the year, you may be able to exclude from your income all or part of them. How to file state taxes You must complete Form 2441, Part III, before you can figure the amount of your credit. How to file state taxes See Dependent Care Benefits under How To Figure the Credit, later. How to file state taxes Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 503 Child and Dependent Care Expenses 926 Household Employer's Tax Guide Form (and Instructions) 2441 Child and Dependent Care Expenses Schedule H (Form 1040) Household Employment Taxes W-7 Application for IRS Individual Taxpayer Identification Number W-10 Dependent Care Provider's Identification and Certification Tests To Claim the Credit To be able to claim the credit for child and dependent care expenses, you must file Form 1040 or Form 1040A, not Form 1040EZ, and meet all the following tests. How to file state taxes The care must be for one or more qualifying persons who are identified on Form 2441. How to file state taxes (See Qualifying Person Test . How to file state taxes ) You (and your spouse if filing jointly) must have earned income during the year. How to file state taxes (However, see Rule for student-spouse or spouse not able to care for self under Earned Income Test, later. How to file state taxes ) You must pay child and dependent care expenses so you (and your spouse if filing jointly) can work or look for work. How to file state taxes (See Work-Related Expense Test , later. How to file state taxes ) You must make payments for child and dependent care to someone you (and your spouse) cannot claim as a dependent. How to file state taxes If you make payments to your child, he or she cannot be your dependent and must be age 19 or older by the end of the year. How to file state taxes You cannot make payments to: Your spouse, or The parent of your qualifying person if your qualifying person is your child and under age 13. How to file state taxes (See Payments to Relatives or Dependents under Work-Related Expense Test, later. How to file state taxes ) Your filing status may be single, head of household, or qualifying widow(er) with dependent child. How to file state taxes If you are married, you must file a joint return, unless an exception applies to you. How to file state taxes (See Joint Return Test , later. How to file state taxes ) You must identify the care provider on your tax return. How to file state taxes (See Provider Identification Test , later. How to file state taxes ) If you exclude or deduct dependent care benefits provided by a dependent care benefits plan, the total amount you exclude or deduct must be less than the dollar limit for qualifying expenses (generally, $3,000 if one qualifying person was cared for or $6,000 if two or more qualifying persons were cared for). How to file state taxes (If two or more qualifying persons were cared for, the amount you exclude or deduct will always be less than the dollar limit, since the total amount you can exclude or deduct is limited to $5,000. How to file state taxes See Reduced Dollar Limit under How To Figure the Credit, later. How to file state taxes ) These tests are presented in Figure 32-A and are also explained in detail in this chapter. How to file state taxes Figure 32-A. How to file state taxes Can You Claim the Credit? Please click here for the text description of the image. How to file state taxes Figure 32-A Can You Claim the Credit? Qualifying Person Test Your child and dependent care expenses must be for the care of one or more qualifying persons. How to file state taxes A qualifying person is: Your qualifying child who is your dependent and who was under age 13 when the care was provided (but see Child of divorced or separated parents or parents living apart, later), Your spouse who was not physically or mentally able to care for himself or herself and lived with you for more than half the year, or A person who was not physically or mentally able to care for himself or herself, lived with you for more than half the year, and either: Was your dependent, or Would have been your dependent except that: He or she received gross income of $3,900 or more, He or she filed a joint return, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. How to file state taxes Dependent defined. How to file state taxes   A dependent is a person, other than you or your spouse, for whom you can claim an exemption. How to file state taxes To be your dependent, a person must be your qualifying child (or your qualifying relative). How to file state taxes Qualifying child. How to file state taxes   To be your qualifying child, a child must live with you for more than half the year and meet other requirements. How to file state taxes More information. How to file state taxes   For more information about who is a dependent or a qualifying child, see chapter 3. How to file state taxes Physically or mentally not able to care for oneself. How to file state taxes   Persons who cannot dress, clean, or feed themselves because of physical or mental problems are considered not able to care for themselves. How to file state taxes Also, persons who must have constant attention to prevent them from injuring themselves or others are considered not able to care for themselves. How to file state taxes Person qualifying for part of year. How to file state taxes   You determine a person's qualifying status each day. How to file state taxes For example, if the person for whom you pay child and dependent care expenses no longer qualifies on September 16, count only those expenses through September 15. How to file state taxes Also see Yearly limit under Dollar Limit, later. How to file state taxes Birth or death of otherwise qualifying person. How to file state taxes   In determining whether a person is a qualifying person, a person who was born or died in 2013 is treated as having lived with you for more than half of 2013 if your home was the person's home for more than half the time he or she was alive in 2013. How to file state taxes Taxpayer identification number. How to file state taxes   You must include on your return the name and taxpayer identification number (generally the social security number) of the qualifying person(s). How to file state taxes If the correct information is not shown, the credit may be reduced or disallowed. How to file state taxes Individual taxpayer identification number (ITIN) for aliens. How to file state taxes   If your qualifying person is a nonresident or resident alien who does not have and cannot get a social security number (SSN), use that person's ITIN. How to file state taxes The ITIN is entered wherever an SSN is requested on a tax return. How to file state taxes To apply for an ITIN, see Form W-7. How to file state taxes   An ITIN is for tax use only. How to file state taxes It does not entitle the holder to social security benefits or change the holder's employment or immigration status under U. How to file state taxes S. How to file state taxes law. How to file state taxes Adoption taxpayer identification number (ATIN). How to file state taxes   If your qualifying person is a child who was placed in your home for adoption and for whom you do not have an SSN, you must get an ATIN for the child. How to file state taxes File Form W-7A, Application for Taxpayer Identification Number for Pending U. How to file state taxes S. How to file state taxes Adoptions. How to file state taxes Child of divorced or separated parents or parents living apart. How to file state taxes   Even if you cannot claim your child as a dependent, he or she is treated as your qualifying person if: The child was under age 13 or was not physically or mentally able to care for himself or herself, The child received over half of his or her support during the calendar year from one or both parents who are divorced or legally separated under a decree of divorce or separate maintenance, are separated under a written separation agreement, or lived apart at all times during the last 6 months of the calendar year, The child was in the custody of one or both parents for more than half the year, and You were the child's custodial parent. How to file state taxes   The custodial parent is the parent with whom the child lived for the greater number of nights in 2013. How to file state taxes If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. How to file state taxes For details and an exception for a parent who works at night, see Pub. How to file state taxes 501. How to file state taxes   The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents. How to file state taxes Earned Income Test To claim the credit, you (and your spouse if filing jointly) must have earned income during the year. How to file state taxes Earned income. How to file state taxes   Earned income includes wages, salaries, tips, other taxable employee compensation, and net earnings from self-employment. How to file state taxes A net loss from self-employment reduces earned income. How to file state taxes Earned income also includes strike benefits and any disability pay you report as wages. How to file state taxes   Generally, only taxable compensation is included. How to file state taxes However, you can elect to include nontaxable combat pay in earned income. How to file state taxes If you are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election. How to file state taxes (In other words, if one of you makes the election, the other one can also make it but does not have to. How to file state taxes ) You should figure your credit both ways and make the election if it gives you a greater tax benefit. How to file state taxes Members of certain religious faiths opposed to social security. How to file state taxes   Certain income earned by persons who are members of certain religious faiths that are opposed to participation in Social Security Act programs and have an IRS-approved form that exempts certain income from social security and Medicare taxes may not be considered earned income for this purpose. How to file state taxes See Earned Income Test in Publication 503. How to file state taxes Not earned income. How to file state taxes   Earned income does not include: Pensions and annuities, Social security and railroad retirement benefits, Workers' compensation, Interest and dividends, Unemployment compensation, Scholarship or fellowship grants, except for those reported on a Form W-2 and paid to you for teaching or other services, Nontaxable workfare payments, Child support payments received by you, Income of nonresident aliens that is not effectively connected with a U. How to file state taxes S. How to file state taxes trade or business, or Any amount received for work while an inmate in a penal institution. How to file state taxes Rule for student-spouse or spouse not able to care for self. How to file state taxes   Your spouse is treated as having earned income for any month that he or she is: A full-time student, or Physically or mentally not able to care for himself or herself. How to file state taxes (Your spouse also must live with you for more than half the year. How to file state taxes )   If you are filing a joint return, this rule also applies to you. How to file state taxes You can be treated as having earned income for any month you are a full-time student or not able to care for yourself. How to file state taxes   Figure the earned income of the nonworking spouse described under (1) or (2) above as explained under Earned Income Limit , later. How to file state taxes   This rule applies to only one spouse for any one month. How to file state taxes If, in the same month, both you and your spouse do not work and are either full-time students or not physically or mentally able to care for yourselves, only one of you can be treated as having earned income in that month. How to file state taxes Full-time student. How to file state taxes   You are a full-time student if you are enrolled at a school for the number of hours or classes that the school considers full time. How to file state taxes You must have been a full-time student for some part of each of 5 calendar months during the year. How to file state taxes (The months need not be consecutive. How to file state taxes ) School. How to file state taxes   The term “school” includes high schools, colleges, universities, and technical, trade, and mechanical schools. How to file state taxes A school does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet. How to file state taxes Work-Related Expense Test Child and dependent care expenses must be work-related to qualify for the credit. How to file state taxes Expenses are considered work-related only if both of the following are true. How to file state taxes They allow you (and your spouse if filing jointly) to work or look for work. How to file state taxes They are for a qualifying person's care. How to file state taxes Working or Looking for Work To be work-related, your expenses must allow you to work or look for work. How to file state taxes If you are married, generally both you and your spouse must work or look for work. How to file state taxes One spouse is treated as working during any month he or she is a full-time student or is not physically or mentally able to care for himself or herself. How to file state taxes Your work can be for others or in your own business or partnership. How to file state taxes It can be either full time or part time. How to file state taxes Work also includes actively looking for work. How to file state taxes However, if you do not find a job and have no earned income for the year, you cannot take this credit. How to file state taxes See Earned Income Test , earlier. How to file state taxes An expense is not considered work-related merely because you had it while you were working. How to file state taxes The purpose of the expense must be to allow you to work. How to file state taxes Whether your expenses allow you to work or look for work depends on the facts. How to file state taxes Example 1. How to file state taxes The cost of a babysitter while you and your spouse go out to eat is not normally a work-related expense. How to file state taxes Example 2. How to file state taxes You work during the day. How to file state taxes Your spouse works at night and sleeps during the day. How to file state taxes You pay for care of your 5-year-old child during the hours when you are working and your spouse is sleeping. How to file state taxes Your expenses are considered work-related. How to file state taxes Volunteer work. How to file state taxes    For this purpose, you are not considered to be working if you do unpaid volunteer work or volunteer work for a nominal salary. How to file state taxes Work for part of year. How to file state taxes   If you work or actively look for work during only part of the period covered by the expenses, then you must figure your expenses for each day. How to file state taxes For example, if you work all year and pay care expenses of $250 a month ($3,000 for the year), all the expenses are work-related. How to file state taxes However, if you work or look for work for only 2 months and 15 days during the year and pay expenses of $250 a month, your work-related expenses are limited to $625 (2½ months × $250). How to file state taxes Temporary absence from work. How to file state taxes   You do not have to figure your expenses for each day during a short, temporary absence from work, such as for vacation or a minor illness, if you have to pay for care anyway. How to file state taxes Instead, you can figure your credit including the expenses you paid for the period of absence. How to file state taxes   An absence of 2 weeks or less is a short, temporary absence. How to file state taxes An absence of more than 2 weeks may be considered a short, temporary absence, depending on the circumstances. How to file state taxes Example. How to file state taxes You pay a nanny to care for your 2-year-old son and 4-year-old daughter so you can work. How to file state taxes You become ill and miss 4 months of work but receive sick pay. How to file state taxes You continue to pay the nanny to care for the children while you are ill. How to file state taxes Your absence is not a short, temporary absence, and your expenses are not considered work-related. How to file state taxes Part-time work. How to file state taxes   If you work part-time, you generally must figure your expenses for each day. How to file state taxes However, if you have to pay for care weekly, monthly, or in another way that includes both days worked and days not worked, you can figure your credit including the expenses you paid for days you did not work. How to file state taxes Any day when you work at least 1 hour is a day of work. How to file state taxes Example 1. How to file state taxes You work 3 days a week. How to file state taxes While you work, your 6-year-old child attends a dependent care center, which complies with all state and local regulations. How to file state taxes You can pay the center $150 for any 3 days a week or $250 for 5 days a week. How to file state taxes Your child attends the center 5 days a week. How to file state taxes Your work-related expenses are limited to $150 a week. How to file state taxes Example 2. How to file state taxes The facts are the same as in Example 1 except the center does not offer a 3-day option. How to file state taxes The entire $250 weekly fee may be a work-related expense. How to file state taxes Care of a Qualifying Person To be work-related, your expenses must be to provide care for a qualifying person. How to file state taxes You do not have to choose the least expensive way of providing care. How to file state taxes The cost of a paid care provider may be an expense for the care of a qualifying person even if another care provider is available at no cost. How to file state taxes Expenses are for the care of a qualifying person only if their main purpose is the person's well-being and protection. How to file state taxes Expenses for household services qualify if part of the services is for the care of qualifying persons. How to file state taxes See Household services , later. How to file state taxes Expenses not for care. How to file state taxes   Expenses for care do not include amounts you pay for food, lodging, clothing, education, and entertainment. How to file state taxes However, you can include small amounts paid for these items if they are incidental to and cannot be separated from the cost of caring for the qualifying person. How to file state taxes   Child support payments are not for care and do not qualify for the credit. How to file state taxes Education. How to file state taxes   Expenses for a child in nursery school, preschool, or similar programs for children below the level of kindergarten are expenses for care. How to file state taxes Expenses to attend kindergarten or a higher grade are not expenses for care. How to file state taxes Do not use these expenses to figure your credit. How to file state taxes   However, expenses for before- or after-school care of a child in kindergarten or a higher grade may be expenses for care. How to file state taxes   Summer school and tutoring programs are not for care. How to file state taxes Example 1. How to file state taxes You take your 3-year-old child to a nursery school that provides lunch and educational activities as a part of its preschool childcare service. How to file state taxes The lunch and educational activities are incidental to the childcare, and their cost cannot be separated from the cost of care. How to file state taxes You can count the total cost when you figure the credit. How to file state taxes Example 2. How to file state taxes You place your 10-year-old child in a boarding school so you can work full time. How to file state taxes Only the part of the boarding school expense that is for the care of your child is a work-related expense. How to file state taxes You can count that part of the expense in figuring your credit if it can be separated from the cost of education. How to file state taxes You cannot count any part of the amount you pay the school for your child's education. How to file state taxes Care outside your home. How to file state taxes   You can count the cost of care provided outside your home if the care is for your dependent under age 13 or any other qualifying person who regularly spends at least 8 hours each day in your home. How to file state taxes Dependent care center. How to file state taxes   You can count care provided outside your home by a dependent care center only if the center complies with all state and local regulations that apply to these centers. How to file state taxes   A dependent care center is a place that provides care for more than six persons (other than persons who live there) and receives a fee, payment, or grant for providing services for any of those persons, even if the center is not run for profit. How to file state taxes Camp. How to file state taxes   The cost of sending your child to an overnight camp is not considered a work-related expense. How to file state taxes The cost of sending your child to a day camp may be a work-related expense, even if the camp specializes in a particular activity, such as computers or soccer. How to file state taxes Transportation. How to file state taxes   If a care provider takes a qualifying person to or from a place where care is provided, that transportation is for the care of the qualifying person. How to file state taxes This includes transportation by bus, subway, taxi, or private car. How to file state taxes However, transportation not provided by a care provider is not for the care of a qualifying person. How to file state taxes Also, if you pay the transportation cost for the care provider to come to your home, that expense is not for care of a qualifying person. How to file state taxes Fees and deposits. How to file state taxes   Fees you paid to an agency to get the services of a care provider, deposits you paid to an agency or preschool, application fees, and other indirect expenses are work-related expenses if you have to pay them to get care, even though they are not directly for care. How to file state taxes However, a forfeited deposit is not for the care of a qualifying person if care is not provided. How to file state taxes Example 1. How to file state taxes You paid a fee to an agency to get the services of the nanny who cares for your 2-year-old daughter while you work. How to file state taxes The fee you paid is a work-related expense. How to file state taxes Example 2. How to file state taxes You placed a deposit with a preschool to reserve a place for your 3-year-old child. How to file state taxes You later sent your child to a different preschool and forfeited the deposit. How to file state taxes The forfeited deposit is not for care and so is not a work-related expense. How to file state taxes Household services. How to file state taxes   Expenses you pay for household services meet the work-related expense test if they are at least partly for the well-being and protection of a qualifying person. How to file state taxes   Household services are ordinary and usual services done in and around your home that are necessary to run your home. How to file state taxes They include the services of a housekeeper, maid, or cook. How to file state taxes However, they do not include the services of a chauffeur, bartender, or gardener. How to file state taxes See Household Services in Publication 503 for more information. How to file state taxes   In this chapter, the term housekeeper refers to any household employee whose services include the care of a qualifying person. How to file state taxes Taxes paid on wages. How to file state taxes   The taxes you pay on wages for qualifying child and dependent care services are work-related expenses. How to file state taxes See Employment Taxes for Household Employers , later. How to file state taxes Payments to Relatives or Dependents You can count work-related payments you make to relatives who are not your dependents, even if they live in your home. How to file state taxes However, do not count any amounts you pay to: A dependent for whom you (or your spouse if filing jointly) can claim an exemption, Your child who was under age 19 at the end of the year, even if he or she is not your dependent, A person who was your spouse any time during the year, or The parent of your qualifying person if your qualifying person is your child and under age 13. How to file state taxes Joint Return Test Generally, married couples must file a joint return to take the credit. How to file state taxes However, if you are legally separated or living apart from your spouse, you may be able to file a separate return and still take the credit. How to file state taxes Legally separated. How to file state taxes   You are not considered married if you are legally separated from your spouse under a decree of divorce or separate maintenance. How to file state taxes You may be eligible to take the credit on your return using head of household filing status. How to file state taxes Married and living apart. How to file state taxes   You are not considered married and are eligible to take the credit if all the following apply. How to file state taxes You file a return apart from your spouse. How to file state taxes Your home is the home of a qualifying person for more than half the year. How to file state taxes You pay more than half the cost of keeping up your home for the year. How to file state taxes Your spouse does not live in your home for the last 6 months of the year. How to file state taxes Costs of keeping up a home. How to file state taxes   The costs of keeping up a home normally include property taxes, mortgage interest, rent, utility charges, home repairs, insurance on the home, and food eaten at home. How to file state taxes   The costs of keeping up a home do not include payments for clothing, education, medical treatment, vacations, life insurance, transportation, or mortgage principal. How to file state taxes   They also do not include the purchase, permanent improvement, or replacement of property. How to file state taxes For example, you cannot include the cost of replacing a water heater. How to file state taxes However, you can include the cost of repairing a water heater. How to file state taxes Death of spouse. How to file state taxes   If your spouse died during the year and you do not remarry before the end of the year, you generally must file a joint return to take the credit. How to file state taxes If you do remarry before the end of the year, the credit can be claimed on your deceased spouse's return. How to file state taxes Provider Identification Test You must identify all persons or organizations that provide care for your child or dependent. How to file state taxes Use Form 2441, Part I, to show the information. How to file state taxes If you do not have any care providers and you are filing Form 2441 only to report taxable income in Part III, enter “none” in line 1, column (a). How to file state taxes Information needed. How to file state taxes   To identify the care provider, you must give the provider's: Name, Address, and Taxpayer identification number. How to file state taxes   If the care provider is an individual, the taxpayer identification number is his or her social security number or individual taxpayer identification number. How to file state taxes If the care provider is an organization, then it is the employer identification number (EIN). How to file state taxes   You do not have to show the taxpayer identification number if the care provider is a tax-exempt organization (such as a church or school). How to file state taxes In this case, enter “Tax-Exempt” in the space where Form 2441 asks for the number. How to file state taxes   If you cannot provide all of the information or if the information is incorrect, you must be able to show that you used due diligence (discussed later) in trying to furnish the necessary information. How to file state taxes Getting the information. How to file state taxes   You can use Form W-10 to request the required information from the care provider. How to file state taxes If you do not use Form W-10, you can get the information from one of the other sources listed in the instructions for Form W-10 including: A copy of the provider's social security card, A copy of the provider's completed Form W-4 if he or she is your household employee, A copy of the statement furnished by your employer if the provider is your employer's dependent care plan, or A letter or invoice from the provider if it shows the information. How to file state taxes    You should keep this information with your tax records. How to file state taxes Do not send Form W-10 (or other document containing this information) to the Internal Revenue Service. How to file state taxes Due diligence. How to file state taxes   If the care provider information you give is incorrect or incomplete, your credit may not be allowed. How to file state taxes However, if you can show that you used due diligence in trying to supply the information, you can still claim the credit. How to file state taxes   You can show due diligence by getting and keeping the provider's completed Form W-10 or one of the other sources of information just listed. How to file state taxes Care providers can be penalized if they do not provide this information to you or if they provide incorrect information. How to file state taxes Provider refusal. How to file state taxes   If the provider refuses to give you their identifying information, you should report on Form 2441 whatever information you have (such as the name and address). How to file state taxes Enter “See Attached Statement” in the columns calling for the information you do not have. How to file state taxes Then attach a statement explaining that you requested the information from the care provider, but the provider did not give you the information. How to file state taxes Be sure to write your name and social security number on this statement. How to file state taxes The statement will show that you used due diligence in trying to furnish the necessary information. How to file state taxes U. How to file state taxes S. How to file state taxes citizens and resident aliens living abroad. How to file state taxes   If you are living abroad, your care provider may not have, and may not be required to get, a U. How to file state taxes S. How to file state taxes taxpayer identification number (for example, an SSN or EIN). How to file state taxes If so, enter “LAFCP” (Living Abroad Foreign Care Provider) in the space for the care provider's taxpayer identification number. How to file state taxes How To Figure the Credit Your credit is a percentage of your work-related expenses. How to file state taxes Your expenses are subject to the earned income limit and the dollar limit. How to file state taxes The percentage is based on your adjusted gross income. How to file state taxes Figuring Total Work-Related Expenses To figure the credit for 2013 work-related expenses, count only those you paid by December 31, 2013. How to file state taxes Expenses prepaid in an earlier year. How to file state taxes   If you pay for services before they are provided, you can count the prepaid expenses only in the year the care is received. How to file state taxes Claim the expenses for the later year as if they were actually paid in that later year. How to file state taxes Expenses not paid until the following year. How to file state taxes   Do not count 2012 expenses that you paid in 2013 as work-related expenses for 2013. How to file state taxes You may be able to claim an additional credit for them on your 2013 return, but you must figure it separately. How to file state taxes See Payments for prior year's expenses under Amount of Credit in Publication 503. How to file state taxes    If you had expenses in 2013 that you did not pay until 2014, you cannot count them when figuring your 2013 credit. How to file state taxes You may be able to claim a credit for them on your 2014 return. How to file state taxes Expenses reimbursed. How to file state taxes   If a state social services agency pays you a nontaxable amount to reimburse you for some of your child and dependent care expenses, you cannot count the expenses that are reimbursed as work-related expenses. How to file state taxes Example. How to file state taxes You paid work-related expenses of $3,000. How to file state taxes You are reimbursed $2,000 by a state social services agency. How to file state taxes You can use only $1,000 to figure your credit. How to file state taxes Medical expenses. How to file state taxes   Some expenses for the care of qualifying persons who are not able to care for themselves may qualify as work-related expenses and also as medical expenses. How to file state taxes You can use them either way, but you cannot use the same expenses to claim both a credit and a medical expense deduction. How to file state taxes   If you use these expenses to figure the credit and they are more than the earned income limit or the dollar limit, discussed later, you can add the excess to your medical expenses. How to file state taxes However, if you use your total expenses to figure your medical expense deduction, you cannot use any part of them to figure your credit. How to file state taxes    Amounts excluded from your income under your employer's dependent care benefits plan cannot be used to claim a medical expense deduction. How to file state taxes Dependent Care Benefits If you receive dependent care benefits, your dollar limit for purposes of the credit may be reduced. How to file state taxes See Reduced Dollar Limit , later. How to file state taxes But, even if you cannot take the credit, you may be able to take an exclusion or deduction for the dependent care benefits. How to file state taxes Dependent care benefits. How to file state taxes   Dependent care benefits include: Amounts your employer paid directly to either you or your care provider for the care of your qualifying person while you work, The fair market value of care in a daycare facility provided or sponsored by your employer, and Pre-tax contributions you made under a dependent care flexible spending arrangement. How to file state taxes Your salary may have been reduced to pay for these benefits. How to file state taxes If you received benefits as an employee, they should be shown in box 10 of your Form W-2. How to file state taxes See Statement for employee , later. How to file state taxes Benefits you received as a partner should be shown in box 13 of your Schedule K-1 (Form 1065) with code O. How to file state taxes Enter the amount of these benefits on Form 2441, Part III, line 12. How to file state taxes Exclusion or deduction. How to file state taxes   If your employer provides dependent care benefits under a qualified plan, you may be able to exclude these benefits from your income. How to file state taxes Your employer can tell you whether your benefit plan qualifies. How to file state taxes To claim the exclusion, you must complete Part III of Form 2441. How to file state taxes You cannot use Form 1040EZ. How to file state taxes   If you are self-employed and receive benefits from a qualified dependent care benefit plan, you are treated as both employer and employee. How to file state taxes Therefore, you would not get an exclusion from wages. How to file state taxes Instead, you would get a deduction on Form 1040, Schedule C, line 14; Schedule E, line 19 or 28; or Schedule F, line 15. How to file state taxes To claim the deduction, you must use Form 2441. How to file state taxes   The amount you can exclude or deduct is limited to the smallest of: The total amount of dependent care benefits you received during the year, The total amount of qualified expenses you incurred during the year, Your earned income, Your spouse's earned income, or $5,000 ($2,500 if married filing separately). How to file state taxes The definition of earned income for the exclusion or deduction is the same as the definition used when figuring the credit except that earned income for the exclusion or deduction does not include any dependent care benefits you receive. How to file state taxes See Earned Income Limit, later. How to file state taxes    You can choose to include your nontaxable combat pay in earned income when figuring your exclusion or deduction, even if you choose not to include it in earned income for the earned income credit or the credit for child and dependent care expenses. How to file state taxes Statement for employee. How to file state taxes   Your employer must give you a Form W-2 (or similar statement) showing in box 10 the total amount of dependent care benefits provided to you during the year under a qualified plan. How to file state taxes Your employer will also include any dependent care benefits over $5,000 in your wages shown on your Form W-2 in box 1. How to file state taxes Effect of exclusion on credit. How to file state taxes   If you exclude dependent care benefits from your income, the amount of the excluded benefits: Is not included in your work-related expenses, and Reduces the dollar limit, discussed later. How to file state taxes Earned Income Limit The amount of work-related expenses you use to figure your credit cannot be more than: Your earned income for the year if you are single at the end of the year, or The smaller of your or your spouse's earned income for the year if you are married at the end of the year. How to file state taxes Earned income is defined under Earned Income Test , earlier. How to file state taxes For purposes of item (2), use your spouse's earned income for the entire year, even if you were married for only part of the year. How to file state taxes Separated spouse. How to file state taxes   If you are legally separated or married and living apart from your spouse (as described under Joint Return Test , earlier), you are not considered married for purposes of the earned income limit. How to file state taxes Use only your income in figuring the earned income limit. How to file state taxes Surviving spouse. How to file state taxes   If your spouse died during the year and you file a joint return as a surviving spouse, you may, but are not required to, take into account the earned income of your spouse who died during the year. How to file state taxes Community property laws. How to file state taxes   You should disregard community property laws when you figure earned income for this credit. How to file state taxes You or your spouse is a student or not able to care for self. How to file state taxes   Your spouse who is either a full-time student or not able to care for himself or herself is treated as having earned income. How to file state taxes His or her earned income for each month is considered to be at least $250 if there is one qualifying person in your home, or at least $500 if there are two or more. How to file state taxes Spouse works. How to file state taxes   If your spouse works during that month, use the higher of $250 (or $500) or his or her actual earned income for that month. How to file state taxes Spouse qualifies for part of month. How to file state taxes    If your spouse is a full-time student or not able to care for himself or herself for only part of a month, the full $250 (or $500) still applies for that month. How to file state taxes You are a student or not able to care for self. How to file state taxes   These rules also apply if you are a student or not able to care for yourself and you are filing a joint return. How to file state taxes For each month or part of a month you are a student or not able to care for yourself, your earned income is considered to be at least $250 (or $500). How to file state taxes If you also work during that month, use the higher of $250 (or $500) or your actual earned income for that month. How to file state taxes Both spouses qualify. How to file state taxes   If, in the same month, both you and your spouse are either full-time students or not able to care for yourselves, only one spouse can be considered to have this earned income of $250 (or $500) for that month. How to file state taxes Dollar Limit There is a dollar limit on the amount of your work-related expenses you can use to figure the credit. How to file state taxes This limit is $3,000 for one qualifying person, or $6,000 for two or more qualifying persons. How to file state taxes If you paid work-related expenses for the care of two or more qualifying persons, the applicable dollar limit is $6,000. How to file state taxes This $6,000 limit does not need to be divided equally among them. How to file state taxes For example, if your work-related expenses for the care of one qualifying person are $3,200 and your work-related expenses for another qualifying person are $2,800, you can use the total, $6,000, when figuring the credit. How to file state taxes Yearly limit. How to file state taxes   The dollar limit is a yearly limit. How to file state taxes The amount of the dollar limit remains the same no matter how long, during the year, you have a qualifying person in your household. How to file state taxes Use the $3,000 limit if you paid work-related expenses for the care of one qualifying person at any time during the year. How to file state taxes Use $6,000 if you paid work-related expenses for the care of more than one qualifying person at any time during the year. How to file state taxes Reduced Dollar Limit If you received dependent care benefits that you exclude or deduct from your income, you must subtract that amount from the dollar limit that applies to you. How to file state taxes Your reduced dollar limit is figured on Form 2441, Part III. How to file state taxes See Dependent Care Benefits , earlier, for information on excluding or deducting these benefits. How to file state taxes Example 1. How to file state taxes George is a widower with one child and earns $24,000 a year. How to file state taxes He pays work-related expenses of $2,900 for the care of his 4-year-old child and qualifies to claim the credit for child and dependent care expenses. How to file state taxes His employer pays an additional $1,000 under a dependent care benefit plan. How to file state taxes This $1,000 is excluded from George's income. How to file state taxes Although the dollar limit for his work-related expenses is $3,000 (one qualifying person), George figures his credit on only $2,000 of the $2,900 work-related expenses he paid. How to file state taxes This is because his dollar limit is reduced as shown next. How to file state taxes   George's Reduced Dollar Limit 1) Maximum allowable expenses for one qualifying person $3,000 2) Minus: Dependent care benefits George excludes from income −1,000 3) Reduced dollar limit on expenses George can use for the credit $2,000 Example 2. How to file state taxes Randall is married and both he and his wife are employed. How to file state taxes Each has earned income in excess of $6,000. How to file state taxes They have two children, Anne and Andy, ages 2 and 4, who attend a daycare facility licensed and regulated by the state. How to file state taxes Randall's work-related expenses are $6,000 for the year. How to file state taxes Randall's employer has a dependent care assistance program as part of its cafeteria plan, which allows employees to make pre-tax contributions to a dependent care flexible spending arrangement. How to file state taxes Randall has elected to take the maximum $5,000 exclusion from his salary to cover dependent care expenses through this program. How to file state taxes Although the dollar limit for his work- related expenses is $6,000 (two or more qualifying persons), Randall figures his credit on only $1,000 of the $6,000 work-related expense paid. How to file state taxes This is because his dollar limit is reduced as shown next. How to file state taxes   Randall's Reduced Dollar Limit 1) Maximum allowable expenses for two qualifying persons $6,000 2) Minus: Dependent care benefits Randall selects from employer's cafeteria plan and excludes from income −5,000 3) Reduced dollar limit on expenses Randall can use for the credit $1,000 Amount of Credit To determine the amount of your credit, multiply your work-related expenses (after applying the earned income and dollar limits) by a percentage. How to file state taxes This percentage depends on your adjusted gross income shown on Form 1040, line 38, or Form 1040A, line 22. How to file state taxes The following table shows the percentage to use based on adjusted gross income. How to file state taxes   IF your adjusted gross income is: THEN the percentage is:       Over   But not over         $0   $15,000   35%       15,000   17,000   34%       17,000   19,000   33%       19,000   21,000   32%       21,000   23,000   31%       23,000   25,000   30%       25,000   27,000   29%       27,000   29,000   28%       29,000   31,000   27%       31,000   33,000   26%       33,000   35,000   25%       35,000   37,000   24%       37,000   39,000   23%       39,000   41,000   22%       41,000   43,000   21%       43,000   No limit   20%   How To Claim the Credit To claim the credit, you can file Form 1040 or Form 1040A. How to file state taxes You cannot claim the credit on Form 1040EZ. How to file state taxes Form 1040 or 1040A. How to file state taxes   You must complete Form 2441 and attach it to your Form 1040 or 1040A. How to file state taxes Enter the credit on Form 1040, line 48, or Form 1040A, line 29. How to file state taxes Limit on credit. How to file state taxes   The amount of credit you can claim is generally limited to the amount of your tax. How to file state taxes For more information, see the Instructions for Form 2441. How to file state taxes Tax credit not refundable. How to file state taxes   You cannot get a refund for any part of the credit that is more than this limit. How to file state taxes Recordkeeping. How to file state taxes You should keep records of your work-related expenses. How to file state taxes Also, if your dependent or spouse is not able to care for himself or herself, your records should show both the nature and the length of the disability. How to file state taxes Other records you should keep to support your claim for the credit are described earlier under Provider Identification Test . How to file state taxes Employment Taxes for Household Employers If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer. How to file state taxes If you are a household employer, you will need an employer identification number (EIN) and you may have to pay employment taxes. How to file state taxes If the individuals who work in your home are self-employed, you are not liable for any of the taxes discussed in this section. How to file state taxes Self-employed persons who are in business for themselves are not household employees. How to file state taxes Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. How to file state taxes If you use a placement agency that exercises control over what work is done and how it will be done by a babysitter or companion who works in your home, the worker is not your employee. How to file state taxes This control could include providing rules of conduct and appearance and requiring regular reports. How to file state taxes In this case, you do not have to pay employment taxes. How to file state taxes But, if an agency merely gives you a list of sitters and you hire one from that list, and pay the sitter directly, the sitter may be your employee. How to file state taxes If you have a household employee, you may be subject to: Social security and Medicare taxes, Federal unemployment tax, and Federal income tax withholding. How to file state taxes Social security and Medicare taxes are generally withheld from the employee's pay and matched by the employer. How to file state taxes Federal unemployment (FUTA) tax is paid by the employer only and provides for payments of unemployment compensation to workers who have lost their jobs. How to file state taxes Federal income tax is withheld from the employee's total pay if the employee asks you to do so and you agree. How to file state taxes For more information on a household employer's tax responsibilities, see Publication 926 and Schedule H (Form 1040) and its instructions. How to file state taxes State employment tax. How to file state taxes   You may also have to pay state unemployment tax. How to file state taxes Contact your state unemployment tax office for information. How to file state taxes You should also find out whether you need to pay or collect other state employment taxes or carry workers' compensation insurance. How to file state taxes For a list of state unemployment tax agencies, visit the U. How to file state taxes S. How to file state taxes Department of Labor's website. How to file state taxes A link to that website is in Publication 926, or you can find it with an online search. How to file state taxes Prev  Up  Next   Home   More Online Publications