Child and Dependent Care credits, regs. say if you are non working spouse and are looking for a job, you can still get the credit. So that means stay at home parent who needs a break, can send the kid out and go play golf and get the credit.
Is this correct.?
bw
You can't be a completely non-working, stay-at-home parent. You have to have some earned income during the year.
Pub. 503, page 6, says the following.
"Work also includes actively looking for work. However, if you don't find a job and have no earned income for the year, you can't take this credit."
Obviously there's some room for cheating, because it's hard for the IRS to know whether you were actually looking for work at the time that paid child care was provided. But if you're asking about what the rules allow, rather than what you might be able to get away with, then no, you can't go out and play golf and say you were looking for work.
Bob Sandler
I don't believe so as the Treasury Regulation says that expenses paid for a period during only part of which the taxpayer is gainfully employed or in active search of gainful employment must be allocated on a daily basis.
I take that to mean, if you are not actively looking for work on Monday because you played a round of golf, then your day care expense for that day fails the test of being an employment related expense for that day.
I suppose, now you will ask what if I hire someone to watch my child, get in 9 holes of golf and then go out for two job interviews? The answer is in the word "allocated.". Only the expense incurred for the time after golf would be employment related expense.
Little clearer: married couple, one works with earned income, other non working spouse, claims he/she is looking for work but actually not. Simple wants time away from kids. Drives many miles to library, etc. Guess they would need more details in case of an audit.
bw
I get it; suspect audit would be in definitions. tks tho.
bw
That doesn't change the picture at all.
That's tax fraud.
They would need more than details. The non-working spouse would need to have earned income. Looking for work without finding work does not qualify, even if he's actually looking for work and not just falsely claiming to be looking for work. "If you don't find a job and have no earned income for the year, you can't take this credit."
Bob Sandler
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