If I pay for childcare is there any way I can claim it on my taxes if it is not a licensed daycare?

Question

Someone tiold me that it cannot be claimed unless it is a licensed daycare.....this person would be watching my child full time and would be claiming their income on their taxes but will be payed in cash....Can I claim it anywhere on my taxes?

Answer 1

Do not pay in cash.  Use checks or money orders (and if you use money orders, photocopy them before you pay).  It's far too easy to get into a he said/she said argument and then have no proof that you paid.

Get the IRS form W-10 (www.irs.gov) and give it to them.  This will alert them up front that you will be claiming the childcare deduction.

If they refuse to give you the W-10, you can still claim the credit, but must file a paper return and attach a note to the form 2441 that you tried, but failed, to get the SSN/ITIN.

Answer 2

Yes, but you would have to have your childcare providers ss #.  She would have to claim it as earnings on her taxes as well.

Answer 3

IRS does not regulate day care providers so would not know or care if there was a license required.

Answer 4

you can claim it, but the person receiving the money has to provide you with their SS#.  If they are claiming the income, it should be no big deal.   It's usually under dependent care expenses.

Answer 5

That "someone" is wrong, it doesn't have to be a licensed child care facility.  You can still claim it.  She will need to declare it as income.  You'd be wise to pay by check, not cash, so you can prove you paid the amounts.  And you'll have to request her tax id, which is probably her social security number, to put on your return to claim the child care credit.