Who qualifies as a person who needs care? In order to be eligible, the person who needs the care can fall into one of four categories:
1. Your spouse who lived with you for at least half the year and is not physically or mentally unable to care for themselves.
2. A dependent of yours, other than a child, who lived with you for at least half the year and is physically or mentally unable to care for themselves.
3. Someone who is unable to care for themselves and lived with you for more than half the year and otherwise would qualify as your dependent. For example, they do not have too much income or someone else’s dependent has filed as married filing jointly.
4. In general, you can claim a tax credit as an expense paid for someone who is your child 12 years or under or otherwise a dependent at 13 years or older and not able to care for themselves.
You must also subtract any amount of money that has been given to you by your employer as a benefit for this total expense. You are permitted to claim up to $3,000 in expenses if you have one person who qualifies for childcare services and up to $6,000 if you have two or more. However, these do not have to be split up evenly. For example, if you have one infant and one eight year old and both went to Akeba Academy and received childcare services, the infant’s care may cost more than half of the $6,000. You can still claim all of those expenses toward your credit.
Who can claim this credit?
You may claim this credit if you needed Akeba Academy to provide your childcare services because you are working or even looking for a job. If you file as single head of household or qualifying widower, you must have some type of earned income such as wages, salaries, tips, or self-employment income.Have you been a full-time student or unable to care for yourself? You can still claim this credit.
How big of a tax credit can you get?
You can receive up to 35% of your expenses and the expenses. The expenses you can get that 35% on are capped at $3,000 for one qualifying person and $6,000 for two or more. The percentage goes down as the earned income goes up. You cannot claim expenses that exceed either you or your spouse’s earned income for the year.
Be sure to choose Akeba Academy as your childcare so that you know at the end of the year you are eligible for this tax credit. All you need to do is complete form 2441 and also a 1040 or a 1040A. You cannot use a 1040EZ to take this credit. Once you’ve been enrolled with our organization, you can receive your tax documents every year no later than January 5. We look forward to serving you in your childcare needs.