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Tax Deduction For Nanny/babysitter

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Tax Deduction For Nanny/babysitter

Postby Clyff » Thu Dec 01, 2016 9:47 am

s About Taxes)/Tax deduction for nanny/babysitter Advertisement Expert: John Stancil, CPA - 12/3/2007 John,

I paid our babysitter $3600 this year to take care of two of my children. She works on an individual basis and has done the sitting either at her home or ours as suitable at the time.

When I file my return, what documentation would I need to have to get credit or deduction for this ?

Would a written acnowledgement/receipt from the sitter be sufficient? If so what should be included in such an acknowledgement/receipt to make it legally acceptable for tax purpose?

If not, what is the alternative? Thanks

Rajesh

ANSWER: Rajesh,

Thanks for your question.

You don't need to submit any documentation.

You do, however, need to include the name, address, and social security(or other tax ID) number of the day care provider.

In the event of audit, you would need some proof of payment such as canceled check or receipts from the provider.  A written, signed acknowledgment would suffice.  Nothing elaborate, just "day care services provided for XXX"

Hope this helps.

John Stancil, CPA

---------- FOLLOW-UP ----------

Thanks for the prompt reply John.

What if the sitter has provided most of the service at our home and not at a Daycare center. Would that change your response ?
Clyff
 
Posts: 40
Joined: Sat Feb 15, 2014 2:02 pm

Tax Deduction For Nanny/babysitter

Postby Nikos » Fri Dec 02, 2016 3:33 am

It does not change the answer, but it complicates your tax situation.  Nothing changes from what I previously stated.

However, since most of the services are provided in your home, you are probably a household employer.  If you are a household employer, this means you are responsible for payment of her social security and medicare taxes, federal unemployment taxes, and federal income tax withholding. Possibly state unemployment taxes also.  You will have to provide her with a W-2.  These taxes are reported on Schedule H.  

IRS Publication 926 has details about being a household employer.

Hope this helps.

John Stancil, CPA  
Nikos
 
Posts: 38
Joined: Mon Jan 06, 2014 12:26 pm

Tax Deduction For Nanny/babysitter

Postby Itai » Sun Dec 04, 2016 5:09 pm

s About Taxes)/Tax deduction for nanny/babysitter Advertisement Expert: John Stancil, CPA - 12/3/2007 John,

I paid our babysitter $3600 this year to take care of two of my children. She works on an individual basis and has done the sitting either at her home or ours as suitable at the time.

When I file my return, what documentation would I need to have to get credit or deduction for this ?

Would a written acnowledgement/receipt from the sitter be sufficient? If so what should be included in such an acknowledgement/receipt to make it legally acceptable for tax purpose?

If not, what is the alternative? Thanks

Rajesh

ANSWER: Rajesh,

Thanks for your question.

You don't need to submit any documentation.

You do, however, need to include the name, address, and social security(or other tax ID) number of the day care provider.

In the event of audit, you would need some proof of payment such as canceled check or receipts from the provider.  A written, signed acknowledgment would suffice.  Nothing elaborate, just "day care services provided for XXX"

Hope this helps.

John Stancil, CPA

---------- FOLLOW-UP ----------

Thanks for the prompt reply John.

What if the sitter has provided most of the service at our home and not at a Daycare center. Would that change your response ?
Itai
 
Posts: 34
Joined: Tue Jan 14, 2014 7:13 pm


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