Taxpayer Incentives

Inform your employees about these opportunities.

 

Federal tax incentives

 

Child and dependent care credit - A credit is available to an individual taxpayer: (1) for whom there are one or more qualifying individuals and (2) who has incurred employment-related expenses that enable the taxpayer to be gainfully employed. “Qualifying individuals” are the taxpayer's dependent children under the age of 13 and certain other dependents who are incapable of self-care.

A-4301 Child and dependent care credit..pdf 31.5KB Nov 12, 2010 1:46 PM

 

Credit for child and dependent care expenses - Taxpayers can claim credit for child and dependent care expenses that enable them to be gainfully employed. The maximum dollar amount of employment-related expenses eligible for the credit is limited to $3,000 for one qualifying individual and $6,000 for two or more qualifying individuals, reduced by the amount excludable by the taxpayer, which covers employer payments or costs under a dependent care assistance program for furnishing dependent care assistance to the employee. The amount of the credit itself is based on a sliding scale percentage.

EXP 214 Credit for child and dependent care expenses .pdf 25.6KB Nov 12, 2010 1:46 PM

 

Dependent care assistance programs - Employees can exclude amounts paid or incurred by their employer for furnishing dependent care assistance to them under a dependent care assistance program up to the amount of their earned income (for a married employee, the earned income of the lower earning spouse). This exclusion is subject to a limit of $5,000 a year ($2,500 for married couples filing separately). In addition, amounts received under dependent care assistance programs by uniformed services personnel are also excluded from gross income.

EXP 1294 Dependent care assistance programs .pdf 14.7KB Nov 12, 2010 1:42 PM
EXP 1294 Dependent care assistance programs _2_.pdf 15.8KB Nov 12, 2010 1:43 PM