The care provider might be someone who babysits in their own home or it could be a daycare center, etc.
So yes, your friend or relative counts as a care provider as long as they are operating a business.
Who Else Wants To Know If A Friend Or Relative Count As A Care Provider?
- This Provider’s business must be declared on their own tax return as a Schedule C, or the business has its own tax return. Otherwise, the services of a friend or relative or part-time babysitter (for example) won’t count for this credit.
2.If you are paying someone to take care of your child so that you can work, you can use the childcare credit on your tax return.
3. You need to enter either the Social Security number or Tax ID of the childcare provider.
4.If you are paying a relative—it cannot be a relative who you are claiming as a dependent on your tax return.
5.The childcare provider does not have to have a “business” to be paid by you.
For more information on this, visit our office today to speak to our Generational Wealth Specialist.