Third Stimulus Check: Here’s how to get $16,000 back in childcare expenses from this year
STRUGGLING parents should be expecting their $1,400 stimulus checks as the IRS has released its latest batch.
But it is possible to get some extra cash by claiming $16,000 back in childcare expenses.
Parents are most likely eligible to receive the third stimulus check for up to $1,400 and the child tax credit for qualified dependents.
Additionally, they can claim up to $16,000 in tax credits for any childcare expenses this year.
It could be expenses paid for daycare, nannies, camp and even transportation costs.
The child and dependent care tax credit can be claimed for certain expenses related to childcare services.
It could be up to $8,000 for one child and $16,000 for two or more dependents and parents could be able to claim up to 50 per cent depending on their income.
While it can be slightly vague to determine what exactly counts as an expense, the key is that any organisation or person that provides care for your dependent would essentially count as a childcare provider as long as you’re paying them, explains CNET.
Even though rules about care providers are relatively relaxed, parents stand better chances at claiming expenses back if their listed child care providers perform under an official capacity such as a city’s camp program rather than a babysitter who is paid “under the table.”
Parents will be able to claim the expenses when they file their 2021 taxes next year.
For now, it’s important to keep track of all child care expenses, such as keeping receipts from daycare or paid after-school programs.
The next step would be completing Form 2441 and attach it to the Form 1040 tax return.
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If you need help tracking the stimulus check if the relief cash still hasn’t arrived, try using the IRS tool.
The IRS has released its latest batch that includes $1,400 stimulus checks, “plus-up” and first-time payments.
According to CNBC, more than 960,000 checks up to $1,400 have been sent out.