IRS Form 2441 walkthrough - ARCHIVED COPY - READ COMMENTS ONLY
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- Опубліковано 19 лют 2023
- This is an older copy of the video we produced on IRS Form 2441. If you came to this video from another link, I apologize for the inconvenience.
Please feel free to review the comments to see if any of them are of benefit to you. To watch the most up to date version of this video, please check out this link instead: • IRS Form 2441 walkthro...
Please feel free to check out our article, where we've written step by step instructions to help you walk through this tax form! www.teachmepersonalfinance.com/irs-form-2441-instructions/
If you’re looking for tutorials for other IRS Forms that you can file directly through the IRS website, check out our free fillable forms page: www.teachmepersonalfinance.com/free-fillable-tax-forms/
what if there is a amount on box 10 of the w2 but the owner of the w2 did not send her child to a daycare or did not paid nobody for the care of child. ( the child was taken care by a relative at no charge)
If there is an amount on Box 10, that's generally money that the W-2 recipient set aside for dependent care benefits under a cafeteria plan. It's generally not taxed, except for amounts that exceed your employer's limit. The excess will be reported in Box 1, so it's not double-counted.
If the recipient then did not use the money for dependent care, then you may forfeit that money, depending on what the employer rules are for unused benefits.
I would suggest reaching out to the employer to determine the current balance, find out any forfeited amounts, and learn what options are available. Then, make the necessary adjustments to avoid any forfeitures in the future.
So this form we include it with our W2 if we are using TurboTax or will Turbo Tax create one for me?
TurboTax should automatically generate this form, based upon questions that you answer. But you should always review all tax forms that TurboTax generates filing your tax return.
I'm very confused (not a first) :-) Why is any of the dependant FSA taxable? I thought it was like a 401k contribution. Yes, the $5000 was deducted from my overall income. But when it came to box 10 and I put in that 5000, it changed my refund (getting much less) So why is any part of the FSA taxable?
There might be a couple of things.
1. Check to make sure that you listed all dependent care expenses. If you took money out, but did not report qualified care expenses, then this will raise your income. Entering qualified care expenses should reduce it back.
2. If that doesn't work, I would Google 'Your tax preparation software' and 'Form 2441.' Odds are likely that other taxpayers are experiencing similar issues. You should be able to find a solution that addresses your situation.
I contributed $5000 (~$150 per paycheck) to the DCFSA and used it for day care payments (plus some more out of pocket). My W2 from my employer says "Dependent care benefits (box 10) of $2006.03". When filing my tax returns this is counted towards my taxable income in form 2441 because our household income is over the limit of $440K. Does this look right?
The dependent care benefits are reported to you in Box 10 as taxable income, but you can exclude up to that amount (or $5,000, whichever is less) by completing Part III of the Form 2441. You would enter the Box 10 amount in Box 12, then follow the prompts to complete the rest of Part III, based on your tax situation. There isn't an AGI limit for your ability to exclude this from income.
on line 5 is asked about if the spouse/yourself was a student. how do you figure that number if this was to be the case?
According to the instructions, you should multiply the number of months that your spouse was a student by $250 (or $500 if you are claiming the credit for 2 or more qualifying persons). If your spouse was a full-time student, then this would still allow you to claim the maximum available credit, depending on earned income and actual expenses.
In cases where the spouse did not have earned income, was not a full-time student, and was not disabled, then this number would otherwise be equal to zero (or very close). This would result in the overall tax credit being zero (or very close), after going through the rest of the calculations.
thank you for responding this helped alot
@@teachmepersonalfinance2169
turbo tax asks me child care expenses per child but on the next screen it asks expenses spend on child care services. is there a difference?
I'm probably not the best person to help you with navigating the TurboTax menus. You might consider asking this question in a TurboTax forum: ttlc.intuit.com/community/file-with-turbotax/discussion/03/303
What do i do if my care provider doesnt have SSN or EID number? Part 1c
Generally, the IRS would disallow your credit for not providing your care provider's tax identification number unless you can show due diligence. Here's how the IRS instructions define due diligence:
You can show a serious and earnest effort (due diligence) by getting and keeping the provider’s completed Form W-10 or one of the other sources of information listed in the instructions for Form W-10.
If the provider doesn't give you the information, complete the entries you can on line 1. For example, enter the provider's name and address. Enter “See Attached Statement” in the columns for which you don't have the information. Then, attach a statement to your return explaining that the provider didn't give you the information you requested.
Hello, I paid $9850 for childcare in 2023. I also contributed $5000 to my dependent care FSA in 2023. Am I eligible for the credit? I thought the expenses in excess of FSA contributions could be counted toward this credit but according to this form that isn’t the case.
I thought that $9850-$5000 = $4850 can still count toward the $3000*0.2 amount to get the $600 tax credit.
However, going through 2441 I see I cannot get the tax credit. Because I have $5000 of excludable benefits (line 25 and 28), line 29 is a negative number ($3000-$5000).
Thanks for your expertise on this topic.
Since I can't see your Form 2441, I cannot tell whether there are any mistakes in it.
However, IRS Publication 503 states that taxpayers who receive dependent care benefits from their employer (that are excluded from income) must subtract that amount from the dollar limit amount that applies to the tax credit. If you had two qualifying children, then your $6,000 available credit would be reduced by the $5,000 in reported dependent care benefits, and you would still have $1,000 remaining to calculate your credit. If you only had one qualifying child, this exclusion seems to eliminate the available credit.
Can I get full child care credit and dependent care benefits together, if my child care expense is over $8000 and dependent care benefit I received is $2000? I believe I can because my expense is more than $3000 even after subtracting the dependent care benefit from the total expense. Thanks!
The form instructions don't necessarily differentiate between child care and dependent care. The maximum amount of expenses that you can use to claim the credit is: $3,000 for one person, or $6,000 for two or more people.
IRS Publication 503, Child and Dependent Care Expenses, specifically states that you do not need to claim expenses paid per person (i.e. if you spent $6,000 on only one child, you can still use the $6,000 expenses limit instead of the $3,000 limit, as long as you have 2 or more qualifying persons).
Here's the example from the IRS publication:
For example, if you have two qualifying children, one age 3 and one age 11, and you incur $6,000 of qualifying work-related expenses for the 3-year-old, and no qualifying work-related expenses for the 11-year-old, you can use $6,000 to figure the credit. In this situation, you
should list $6,000 for the 3-year-old child and -0- for the 11-year-old child. The $6,000 limit would be used to compute your credit unless you have already excluded or deducted dependent care benefits paid to you (or on your behalf) by your employer.
What if i used dependent care fsa Via employer. But i don't claim my biological child on my taxes. Customer service said i didn't have claim child on taxes. But my girlfriend is Wondering if it'll mess with her tax credit she claims our daughter.
A couple of things:
1. One of the requirements for using Form 2441 is that the child care must be for a qualifying child. A qualifying child is one that you can claim as a dependent on your tax return.
2. If you're using a dependent care FSA, then you would be subject to the qualifying dependent rules under your FSA. If your FSA covers the expenses with pre-tax contributions, then you cannot ALSO claim those expenses as a tax deduction on IRS Form 2441.
If your FSA plan allows you to use the FSA for child care expenses, then you should use it. That should not have an impact on your girlfriend's tax credit, as long as your child meets the following criteria:
-Be under age 17 at the end of the year
-Be your son, daughter, stepchild, eligible foster child, brother, sister, stepbrother, stepsister, half-brother, half-sister, or a descendant of one of these (for example, a grandchild, niece or nephew)
-Provide no more than half of their own financial support during the year
-Have lived with you for more than half the year
-Be properly claimed as your dependent on your tax return
-Not file a joint return with their spouse for the tax year or file it only to claim a refund of withheld income tax or estimated tax paid
-Have been a U.S. citizen, U.S. national or U.S. resident alien
I selected the Dependent FSA benefit from my employer. They put $2500 in the Dependent FSA on our behalf. I used that account to pay for preschool and a day camp for my little one ($1165paid out total) I’m forfeiting the remainder. Just finding out now that we didn’t really qualify for this account as my wife had zero earned income? Line 10 on my W-2 says $2,500. Tax software says I need to fill out this form. But we don’t qualify? Now what? Any help is appreciated. 🙏🏻
You can complete this form if you can honestly state that your wife was looking for a job. That is enough justification for claiming this credit.
With regard to the forfeited amount...you're being taxed on the full $2,500, whether you take the money out of the account or not. you should probably talk with your employer about either being able to take the money out of your account or correcting your Form W-2 (see below)
IRS Form W-2c, Corrected Tax Statement
Article: www.teachmepersonalfinance.com/irs-form-w-2c-instructions/
Video: ua-cam.com/video/H6hJmR_jcbo/v-deo.html
What do I do is I didn’t pay any childcare expenses? For some reason I can’t submit without this form online
If you didn't pay child care expenses, then you can't take the tax credit on Form 2441. However, if your tax software is not allowing you to submit your tax return, then there might be another setting elsewhere in your return that's triggering Form 2441. Without knowing more about your software or tax situation, I can't give you specific advice. However, you might try some of these:
1. Go back to the beginning of your tax return and review all of your prompts. Perhaps there's a tax credit or other prompt that you selected, which automatically triggered this form.
2. Google your situation and the name of your tax software. If you're encountering an issue, odds are pretty likely that someone else has encountered it. For example, TurboTax has the following thread: ttlc.intuit.com/turbotax-support/en-us/help-article/small-business-processes/delete-form-2441-turbotax-online/L2tuu4BBs_US_en_US
I hope this helps.
@@teachmepersonalfinance2169 I’m not sure because I went back and I selected no for the tax credit on that. But it just keeps popping up I’ll try and make a call to someone
Only 15 states provide a child and dependable care refundable credit? Is this true?
There are probably a handful of states that provide child and dependent care credits on state income taxes. However, IRS Form 2441 is for federal income taxes, which should apply to your federal income tax liability, regardless of which state you live in.
States with zero income tax, for example, wouldn't provide any tax credits against income tax liabilities.
How do I know what to put in line 10 though?
In the IRS Form instructions, there is a worksheet for calculating Line 10: www.irs.gov/instructions/i2441#en_US_2022_publink1000106355.
Here is what the worksheet says (verbatim):
1. Enter the amount from Form 1040, 1040-SR, or 1040-NR, line 18 1. _____
2. Enter the amount from Schedule 3 (Form 1040), line 1 (foreign tax credit) and line 6l (Form 8978, line 14) 2. _____
3. Subtract line 2 from line 1. Also enter this amount on Form 2441, line 10. But if zero or less, stop; you can’t take the credit
How would I amend my 2441 if all my expenses for child care wasn’t recorded?
I'm not sure what you mean. Do you mean amending your Form 2441 that you already filed with your tax return?
@@teachmepersonalfinance2169 yes, when we filed the tax preparer we used didn’t not record all of our expenses that we paid for child care for the 2022 year. I wanted to add that so we can resubmit it.
@@kiaraherrera1860 You may need to file an amended tax return with an updated Form 2441. However, you should verify this with your tax preparer, or a different tax professional in your area.
Why is it not populating some credits? Earn income is within the limits.
I'm not sure why this form isn't working for you. It might depend on the tax software that you're using.
If you can't resolve this on your own, it might be worth running your tax situation by a tax professional, such as a CPA or enrolled agent, just to see if there's something else impacting your tax credits.
@@teachmepersonalfinance2169 Thanks very much. Found it.
Why not give an example?