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Arthur Rubin
Arthur Rubin, Tax Preparer
Category: Tax
Satisfied Customers: 1515
Experience:  22 years of tax preparation experience, including individual, trust, and estate returns.
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1) My accountant told me that since i am claiming my daughter

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1) My accountant told me that since i am claiming my daughter as a dependent that I cannot also claim her daycare costs here in California. Is this true?

2) I am self employed and I currently only get 1099 income. My investment guy tells me this is not a problem with my roth IRA and my accountant tells me that I need to have w2 income to be eligible for a roth ira who is right?

Arthur Rubin :

I don't fully understand your question 1. "Claim daycare costs" could have multiple meanings.

Arthur Rubin :

However, you need a new accountant. Any earned income, which includes gross W-2 wages and net business income, as reported on Schedule SE, can satisfy the Roth IRA requirement.

Customer:

Daycare cost me about $5000 in 2011. I was under the impression that I could claim this as a deduction besides claiming my daughter as a dependent. What other information can I offer to help get this answered?

Arthur Rubin :

Sorry about the delay; I had to assist my wife.

Arthur Rubin :

You cannot take child care as a deduction; however, if it is so you can work, you can take it as a credit on both the Federal and California returns.

Arthur Rubin :

The Federal form is form 2441, Child and Dependent Care Credit.

Arthur Rubin :

The formula for the Federal credit is 20-30% of your expenses, up to $2400 for one child, or $4800 for more than one child.

Arthur Rubin :

If your business provides a child care facility, you can claim a California-only credit for 50-100% of the cost. (I don't remember whether it's 50 or 100%; if you are interested, I'll check.)

Customer:

My daughter is in 3rd grade and her school ends at 2pm so she goes to a place next door to the school called sunshine daycare. I pick her up after work at 5:30pm everyday. So does this qualify in California as a valid deduction?

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