Reason: The IRS has given the OK to extend the dependent-care credit to such specialty camps, which focus on a single activity. (IRS proposed regulation 139059-02)
The credit is generally limited to 20 percent of the first $3,000 for one child or 20 percent of the first $6,000 for two or more children. So, if you send your two kids to tennis camp this summer, you can slash $1,200 (20 percent of $6,000) right off the top of your tax bill.
The IRS also says you can include the cost of transportation in the credit, but only if it’s included in the cost of the camp.
The IRS is accepting public comment on its proposal until Aug. 22, and could change or withdraw the proposal based on those comments.
We’ll keep you posted.
- Small Business Tax Deduction Strategies No matches