The child and dependent care credit only picked up where any tax-free employee benefit reimbursement(s) left off.
The Secrets Of Tax-Deductible Dependent Care From Work
- If the $10,000 you paid was after-tax, you are entitled to the Child and Dependent Care Credit. It is acceptable to still report after-tax expenses in this section. If it was paid with pre-tax dollars, then it should be removed.
- The only potential issue is that pre-tax dollars are not used for the designated expense. If the disbursement is not qualified, the disbursement should be returned.
- As long as any pre-tax dollars all went for child and dependent care, there is nothing to report. Keep the annual activity for the account for your records to prove that the monies disbursed were for qualifying expenses.
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