Which of these expenses can be claimed for child care expenses deduction (2017)?

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retprof
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Joined: Mon Nov 13, 2017 2:06 pm

Which of these expenses can be claimed for child care expenses deduction (2017)?

Post by retprof » Thu Mar 15, 2018 12:39 pm

My child started pre-school in September 2017, and during 2017 I made the following payments:

A. $525 x 4 = $2,100 in tuition for September-December
B. $118 extra tuition in September to cover registration, insurance, and earthquake kits for the children.
C. $525 deposit, which will be applied to tuition for the last month my child attends school.

My guess is that only A can be claimed for the child care deduction, is this correct?

PS: I did not have a dependent care FSA for 2017, that is why I will be claiming the deduction.

FreemanB
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Joined: Thu May 22, 2014 5:55 am

Re: Which of these expenses can be claimed for child care expenses deduction (2017)?

Post by FreemanB » Thu Mar 15, 2018 12:57 pm

If B was required as a condition of attendance/enrollment, then it should be deductible as well, since any fees necessary for enrollment are considered qualifying expenses. For C, it will definitely be considered an expense, but I'm not sure when it would normally be taken. I would lean towards including it in the year it was paid though, since that's generally how other deductions work.(And then your last year would have one less month of tuition expenses) Again, that's only if the deposit was required for attendance.

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HueyLD
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Re: Which of these expenses can be claimed for child care expenses deduction (2017)?

Post by HueyLD » Thu Mar 15, 2018 12:58 pm

The Pub 503 has the following guidelines and examples.
Expenses for a child in nursery school, preschool, or similar programs for children below the level of kindergarten are expenses for care.
...
Example 1.

You take your 3-year-old child to a nursery school that provides lunch and a few educational activities as part of its preschool childcare service. The lunch and educational activities are incidental to the childcare, and their cost can't be separated from the cost of care. You can count the total cost when you figure the credit.
...
Fees and deposits.

Fees you paid to an agency to get the services of a care provider, deposits you paid to an agency or preschool, application fees, and other indirect expenses are work-related expenses if you have to pay them to get care, even though they aren't directly for care. However, a forfeited deposit isn't for the care of a qualifying person if care isn't provided.
Based on the above guidelines, I think you are good to go to include all three. However, you need to read the guidelines and make sure that your expenditures meet the criteria.

retprof
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Joined: Mon Nov 13, 2017 2:06 pm

Re: Which of these expenses can be claimed for child care expenses deduction (2017)?

Post by retprof » Thu Mar 15, 2018 5:31 pm

Thank you FreemanB and HueyLD, your answers are extremely helpful.

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