About James G Rogers CPA Expertise Federal Individual Income Tax and state income tax questions as well as GENERAL LLC, partnerships and estate & trusts tax questions. Sub-specialty in ordained clergy questions.
Experience Private solo practitioner since 1975 with clients around the United States and foreign countries. I am based and licensed in Pennsylvania.
Organizations:
American Institute of CPAs
Pennsylvania Institute of CPAs
Philadelphia Estate Planning Council
Electronic Return Originator, IRS
Publications:
Nonprofit Times
Fundraising Management
Education/Credentials:
CPA licensed in Pennsylvania
BA, Washington & Lee University, Virginia
MBA, American University, Washington, DC
PhD Candidate, University of Buckingham, England
Past/Present Clients:
Individuals around the United States and U.S. ex-patriots living overseas. U.S. clients with Subchapter S corporations and LLCs as well as estates and trusts and partnerships.
Sub-specialty in ordained clergy tax matters.
Question My ex and I have joint custody of our daughter. We take turns claiming her, however. I am responsible for paying child care every year. On the off years when I am NOT claiming her, can I still claim the childcare expenses I pay for? Also, Can I claim childcare expenses and sign up for childcare spending account through my work at the same time? How does that work?
Answer Dear Chris,
Under the Special Rule for Children of Divorced (or Separated) Parents, you CAN claim your daughter's child care expenses (i.e., she is treated as a qualifying person) for what you called the "off year" IF BOTH of the following conditions are true for that year:
(1) She is under the age of 13 or was physically or mentally unable to care for herself AND
(2) You were her custodial parent (i.e., she lived with you for more than half the year).
Following is the instructions from the IRS' Web site for Form 2441, Child and Dependent Care Expenses, which will give you more information:
If you sign up for a child care spending account at work, your taxable wages will be reduced by your contribution amount. You can then pay your daughter's qualifying child care expenses from that account, in effect paying for them with pre-tax dollars.
If you use such a spending account, it will very likely have an impact on the credit to which you'd be entitled on Form 2441.
Ask your HR benefits person at work to explain the child care expense account details and any spend-out provisions. In many cases, these kinds of accounts are on a "use it or lose it" basis for any given tax year. If you deposit, say, $3,000 into it, you'd want to spend no less than $3,000 on qualifying expenses. For those accounts, any money remaining in the account at the end of the year is forfeited.
All this is to say, do check with your HR people, read everything carefully and ask questions before you sign up.
