Tax Tips

Tax Tip: A Tax Credit to Offset Day Camp Expenses

July 11, 2012 : Darla Tierney

Did you know that The Child and Dependent Care Tax Credit can help to offset the cost of your child’s day camp this summer?

Day camp, like day care or a babysitter at home, is considered a childcare expense — and the tax credit is available for expenses incurred during the summer and through the rest of the year. Overnight camps and summer school or tutoring, however, do not qualify.

Here’s what you need to know about using the Child and Dependent Care Tax Credit to offset your day care costs, courtesy of our friends at the IRS:

1. Children must be under age 13 in order to qualify.

2. Taxpayers may qualify for the credit, whether the childcare provider is a sitter at home or a daycare facility outside the home.

3. You may use up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit.

4. The credit can be up to 35 percent of qualifying expenses, depending on income.

5. Expenses for overnight camps or summer school/tutoring do not qualify.

6. Save receipts and paperwork as a reminder when filing your 2012 tax return. Remember to note the Employee Identification Number (EIN) of the camp as well as its location and the dates attended.

For more information, give IRS Publication 503 a read — it breaks down everything you need to know about the Child and Dependent Care credit.


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