As a busy working parent, you may be on the lookout for activities available for your kids this summer. There may be a solution that’s also a tax break: Summer camp!
Using the Child and Dependent Care Credit, you can be reimbursed for part of the cost of enrolling your child in a day camp this summer.
Am I eligible?
- If you are married, you and your spouse must both be working.
- Your child must be under age 13, your legal dependent, and live in your residence for more than half the year.
Tip: If your spouse doesn’t work but is either a full-time student or is disabled and incapable of self-care, you can still qualify for the credit.
How much can I save?
For 2022, you can claim a maximum credit of $1,050 on up to $3,000 in expenses for one child or $2,100 on up to $6,000 for two or more children.
What kind of camps?
The only rule is no overnight camps.
The Child and Dependent Care Credit intends to help working people care for their kids during the work day, so summer camps where kids stay overnight aren’t eligible for this credit.
Other than that, it doesn’t matter what kind of camp: soccer camp, chess camp, summer school, or even daycare. All of these are eligible expenses for this credit.
Other ways to use this credit
While summer day camp costs are a common way to use this credit, any cost to provide care for your children while you are working may be eligible.
For example, you can use this credit to pay a qualified daycare center, a housekeeper, or a babysitter to take care of your child while you are working. You can even pay a relative to care for your child and claim the credit for that expense, as long as the relative isn’t your dependent, minor child, or spouse.
The Child Dependent Care Credit is just one of many possible tax breaks related to children and dependents. Please call if you have questions about this credit or want to discuss any other tax savings ideas.