How to Enjoy Tax Benefits from Your Summer Expenses
A lot of families nowadays go on vacations, tours, cruises, and even to simple camping trips during the summer break. Have you planned your family getaway this year? We sure hope so.
However, did you know that some of the costs and expenses you incur during your summer vacation can actually be deducted from your income tax for the year? If you didn’t, and you wish to learn more tax tips that can help you and your household enjoy huge savings; we suggest you pay close attention to the remainder of this article.
Summer day camp expenses.
If you are a working parent and want to send your kids to a day camp program, you can claim credit for the expenses, as long as the child is below 13 years old. Take note that overnight in the summer camp are not tax-deductible. {Also read How to Claim the Child Tax Credit}
Check your paperwork.
Be sure to attach a federal form 2441 to a federal form 1040 , federal form 1040A, or form 1040NR. However, this rule does not apply to stay-at-home parents. So if you are unemployed, you will not be able to claim credit for child care expenses.
Prepare your references.
Upon filing tax claims for child care summer expenses, you will be required to provide your child or each of your child’s Social Security number. Make sure that you have this information handy when preparing your taxes.
Send your kids to the right summer camp.
To claim tax summer child care benefits, you have to send your kids to qualified summer camp provider. A provider cannot be your spouse or a dependent. If you have a son or daughter who is at least 19 years old, living independently, he/she can be an eligible care provider. In addition, you must declare the care provider’s name, address, and tax ID number.
Know which child care expenses qualify.
Not all expenses spent during the summer camp can qualify for tax credit so it’s important to be aware of the specific items you can deduct. For example, food, clothing, and fuel expenses as you drive your child to the summer camp will not qualify. You can claim up to $3,000 credit for one child and up to $6,000 if you have two or more kids.
Check if you’re eligible.
In order to claim credit, you need to show proof of income for the year. You must have paid expenses for child care so that you can have time to get a job. If you have not earned income during the year, then you will not be able to file for claim. Visit the IRS website for more information (http://www.irs.gov/newsroom/article/0,,id=172245,00.html)
