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Tax Deduction Consulting: Dependent Care Wilmington DE

There is a tax credit associated with the cost of dependent care. The rules and regulations for taking this credit, as would be expected, are very complex. The credit is limited to 35% of actual expenses. Since it is a credit, however, that comes directly off your taxes owed; it is an important fact in your individual tax obligation. In some cases, this credit will be reduced if you receive dependent care benefits.

Frank M. Levy (RFC®), CHFC, CLU
(302) 765-3500
205 Philadelphia Pike
Wilmington, DE
Company
Diversified Financial Consultants
Qualifications
Years of Experience: 34
Membership
IARFC, MDRT
Services
Invoice, Estate Planning, Business Planning, Pension Planning, Executive Compensation Planning, personal Coach, Retirement Planning, Tax Planning, Employee Benefits, Stocks and Bonds, Mutual Funds, Annuities, Life Insurance, Disability Income Insurance, Long Term Care Insurance, Group Insurance, Charitable Planning, Education Plan, Asset Protection, Compensation Plans

Data Provided by:
Joan L. Sharp (RFC®), CFP, CHFC, MSFS
(302) 324-5363
42 Reads Way
New Castle, DE
Company
Life Strategies, LLC
Qualifications
Education: BAMSFS
Years of Experience: 8
Membership
IARFC, FPA, SFSP
Services
Invoice, Estate Planning, Retirement Planning, Tax Planning, Charitable Planning, Asset Protection, Compensation Plans

Data Provided by:
Delaware Taxes Today
(302) 654-4848
712 N Market St
Wilmington, DE
 
Fast Tax Delaware
(302) 427-2844
725 N Market St
Wilmington, DE
 
Greenbank Tax Service
(302) 995-0923
210 W Market St
Wilmington, DE
 
Bill Curry
1521 Concord Pike
Wilmington, DE
Company
Company: Curry Poole Group, LLC
Type
Investment Advisor Rep: Yes
Registered Investor: Yes
Education
BS
MBA
JD
Years Experience
Years Experience: 42
Service
Pension for Highly Compensated Owners,Stock Market Alternative,Reverse Mortgage,Medicare Planning,Annuities,Alternative Asset Class Planning,Investment Consulting & Allocation Design,Insurance & Risk Management Planning,Retirement Income Distribution Planning,Education Funding & Financial Aid Planning,Hourly Financial Planning Engagements,Portfolio Engineering,Mortgage Refinancing,IRA, 401k, Roth IRA, QDRO Rollovers,CD Alternative,Alternative Investments,Life Insurance,Investment & Portfolio Man

Data Provided by:
Keith Al-Chokhachy, Certified Financial Planner(tm)
2751 Centerville Road
Wilmington, DE
Company
Title: Certified Financial Planner"
Company: Morgan Stanley Smith Barney
Years Experience
Years Experience: 8
Service
Captive Insurance,Life Settlements,Pension for Highly Compensated Owners,Stock Market Alternative,Wealth Management,Health Care Insurance,Retirement Planning,Real Estate Investment Planning,Commission-Only Financial Planning (Full Disclosure),Insurance & Risk Management Planning,Retirement Income Distribution Planning,Education Funding & Financial Aid Planning,Hourly Financial Planning Engagements,Fee Only Portfolio Management,Wealth Engineering,Mortgage Refinancing,IRA, 401k, Roth IRA, QDRO Rol

Data Provided by:
Delaware Taxes Today
(302) 888-1976
712 N Market St
Wilmington, DE
 
Colbert Ball Tax Ser
(302) 543-4631
800 Vandever Ave
Wilmington, DE
 
Eller Tax Service
(302) 656-4787
2303 Lancaster Ave
Wilmington, DE
 
Data Provided by:

Tax Deduction Consulting: Dependent Care

Dependent Care Deductions

There is a tax credit for expenses paid for dependent care. This credit may be reduced if you receive certain dependent care benefits from an employer. In that case, you and be concerned with dependent care deductions.

There is a tax credit associated with the cost of dependent care. The rules and regulations for taking this credit, as would be expected, are very complex. The credit is limited to 35% of actual expenses. Since it is a credit, however, that comes directly off your taxes owed; it is an important fact in your individual tax obligation. In some cases, this credit will be reduced if you receive dependent care benefits. This is where the idea of dependent care deductions would come into play. To maintain equality with taxpayers that can claim the credit, the amount paid to the employee as a dependent benefit should be a deductions from your taxable income.

The types of benefits that can reduce your credit are direct cash payments intended for dependent care that come from your employer and the fair market value of care that is provided by the employer. Also, pre-tax contributions to a dependent care plan. The fair market value provision causes the most confusion to most tax payers. The logic here is that the credit exists to ease the way of tax payers who must care for dependents, and if this care is being provided in part by the employer through a free day care center, the way is being eased.

However, when the benefit is being paid to the employee directly to use for dependent care and this reduces their eligibility to take a credit, it is logical to exclude the income from the taxable income. The employer will be able to tell you if your plan is a qualified plan and eligible for such an exclusion.

The dependent care deductions can be claimed on Part III of Form 2441 or on Schedule 2 of Form 1040A. The tax payer can not use 1040EZ if they are claiming any dependent care deductions. If the tax payer is self employe...

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