On Nov 30, 4:51 pm, kam...[at]panix.com (Arthur Kamlet) wrote:

- quote -

Where in publication 503 does it say this? All I could find was

Work for part of year. If you work or actively look for work during
only part of the period covered by the expenses, then you must figure
your expenses for each day. For example, if you work all year and pay
care expenses of $250 a month ($3,000 for the year), all the expenses
are work related. However, if you work or look for work for only 2
months and 15 days during the year and pay expenses of $250 a month,
your work-related expenses are limited to $625 (21/ months × $250).

So if the OP has expenses of $1000 a month, the wife works for 2
months and looks for a job for 2 months, the qualified expenses are
$4000 (not $12000). However, this is already above the $3000 maximum
for the year. I did not find anywhere in publication 503 that says
the maximum amount of $3000 is reduced to $3000*(4/12)=$1000, or that
the credit is reduced to $3000*0.20*(4/12)=$200.

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pimy wrote:
- quote -

day care in a week (i.e., the center does not offer care just for
the 3 days worked), then the cost of five days is a qualified
expense.

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pimy wrote:

- quote -

Yes, assuming you meet all the requirements, you can get the
Child/Dependent Care Credit for any expenses not provided through an
employer plan. In other words, no double-dipping.

-Mark Bole

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On Nov 30, 11:46 pm, Bob Sandler <bob_use...[at]yahoo.com> wrote:
- quote -

I spoke with my benefits coordinator today. She confirmed that our
limit is 30 days. She wasn't sure if it was the law, or just de facto.
She also stated that changing from MDO to part-time day care would
have qualified as a change of status, but I missed the boat. I will
not get another opportunity to contribute to the DC FSA until my open
enrollment period next year. Will have to make contributions through
wife's plan if she finds employment before then. Based on that, my
original second question is moot. Any answer for my third question?

Thanks,
pimy

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On Nov 30, 7:07 pm, Alan <sfcnm-...[at]yahoo.com> wrote:
- quote -

Thank you both for the quick responses.

Do you think example #2 (see below) under Part-time work in Pub 503
pg. 6 would qualify as an exception? Meaning, if the care center only
offered 5-day care, would we be entitled to the full expense, even if
my wife was only looking for work 3 days out of the week? If the
center offered single day care (based on availability), would I be
forced to use that daily rate (x3) instead of the 5-day rate? Or the
lesser amount of the two?

"Example 1. You work 3 days a week. While you work, your 6-year-old
child attends a dependent care center, which complies with all state
and local regulations. You can pay the center $150 for any 3 days a
week or $250 for 5 days a week. Your child attends the center 5 days a
week. Your work-related expenses are limited to $150 a week.

Example 2. The facts are the same as in Example 1 except the center
does not offer a 3-day option. The entire $250 weekly fee may be a
work-related expense."

Thanks,
pimy

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- quote -

Check the rules for your plan, or ask your HR department.
Every plan I've ever seen has required that you make any
changes within 30 days after the qualifying event (the
change of status). That might be a requirement of the law,
but I'm not sure.

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Arthur Kamlet wrote:
[snip]

- quote -

[snip]
- quote -

The credit is based on paying qualified expenses in order for one
to work or actively look for work. The Op said his wife was
looking for employment. So.. if they paid for child care in order
for her to work those two months and in order for her to actively
look for work for x months.. say Sept thru Dec., then the
qualified expenses are those that were paid for those 6 months.

Technically, the way they wrote the rules, the expenses are
calculated on a daily basis. So.. if the wife actively looked
for work 3 days a week and they paid for childcare for 5 days a
week, then only 3 days of expenses would qualify.

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In article <6b549033-2c7d-417f-bf33-e16d2450ceb3[at]k8g2000yqn.googlegroups.com> ,
pimy <pimy103[at]gmail.com> wrote:
- quote -


Ordinarily you can claim a child care credit based on not more than $3000
for one child and $6000 for more than one child. An employer plan
allows you to have up to $5000 pretax money used for child care
even if only child.


The amount of credit is based on the lowest of your earned income,
your spouse's earned income, and the 3000/6000 figure.


The credit is allowed only when each spouse is wroking, going to school
to train for work, or when disabled.


So if your spouse worked only 4 months, then only 4/12 of the maximum
allowed amount can be used.
--


ArtKamlet at a o l dot c o m Columbus OH K2PZH

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Hello,

I work full-time and have worked this entire year.
Until recently my wife was a homemaker. She did some part-time
contract work for a couple of months (July+August) for ~1000. Since
then, she has been looking for full-time employment.

Our son, was in daycare part-time (8 hrs/wk). A few months ago we
enrolled him in half-time (20 hrs/wk). I have a flexible spending
account available with my current employer, but I've only used it for
medical expenses to date.

I've been looking into claiming a child and dependent care credit for
the 2008 tax year. Here is a summary of the details:

Filing status: Married filling jointly
Qualified dependents: 1 (son)
My income: > $43,000
My wife's income: ~$1,000
Contributions to FSA for dependent care expenses: 0
Estimated total "qualified" expenses since wife began working+looking
for work until end of 2008: ~$2,200


1) Does my wife's employment in July/August still qualify as a change
of status, and allow me to begin contributing to the dependent care
FSA this late after the fact?

2) If I can contribute to the FSA, what would be the recommended
amount, based on the figures I provided above?

3) Would I still potentially qualify for a dependent care credit?
Maybe $200 (20% of the ~1,000)?

Thanks,
pimy

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