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Need some tax advice, and tax questions etc


Springfield

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So I have a tax question, but I suppose others can ask questions as well...

Here's mine:

I pay my mother, in cash, to care for our son while we are at work. I know that this qualifies for a tax credit of up to $3,000. Here's the thing. My mother doesn't want to report this as income because it would hurt her situation (she isn't very well off). If I claim the child care credit, it asks for identifying information about the person caring for my child.

So, if I claim this child care credit and furnish the IRS with my mother's information, is this going to set off a red flag that she should be reporting more income than they actually are?

Thanks for any help that ES can offer.

Sincerely your,

Tax dodging member Springfield

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And im worried about forgetting to report a savings bond I cashed that my grandmother bought me back in like 1977 this year. I totally forgot about it until I received a letter about it from my bank the day AFTER I filed my taxes lol , it was only for $357, but dang it!

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And im worried about forgetting to report a savings bond I cashed that my grandmother bought me back in like 1977 this year. I totally forgot about it until I received a letter about it from my bank the day AFTER I filed my taxes lol , it was only for $357, but dang it!

 

I forgot to report cashing a $50 bond once, got a letter immediately.

 

The IRS can almost do your entire taxes with data they have.  They don't know your charitable contributions and stuff, but they have a handle on everything reported.

 

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I'm *NOT* a tax expert by any means, but I know a friend who paid her mom to watch the kid after my friend's mom lost her job.  Somehow this counted as a job, the government found out, and her mom lost her unemployment benefits.

 

I'm not sure how the government found out-- but that's at least one real data point that this sort of thing can happen.

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So I have a tax question, but I suppose others can ask questions as well...

Yea. I wouldn't do it. If it makes you feel better, it's not a $3,000 credit. It is a credit of 20-35% (depending on income) of up to $3,000 in expenses for 1 kid.

The income requirements are really low for the higher rates. If your combined income just like 40k+ you are at the lowest 20% rate.

20% of $3,000 (max) = $600 credit. That what I got this year on like 10k of child card costs....

$600 probably not worth the risk of an audit.

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It would not be wrong of you to not report it since you're just looking out for your mom. It would also not be wrong for you to maybe fudge some other information on there to make up for not getting what's rightfully yours. I'd suggest saying that your son is two sons and also that one is a disabled vet and the other a clergyman. You should also give your name as Vito "The Mangler" Testosteroney. These are things that the irs tends to overlook.

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We've been in the same situation and haven't been able to claim it.  I've thrown the amount in just trying different scenarios and it doesn't really seem to make a world of difference.  But, if you put him in preschool for a couple days a week then you can end up claiming that (stage we're at now) without messing up daycare costs.

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If nobody claims anything, then I don't see how a law has been broken. I can't give my mother cash gifts because I love her?

 

 

Be careful that when you think you know what the law should mean, but don't know what the law actually means, especially when it comes to the IRS.

 

Also be careful when asking for legal advice on a message board.  

 

I do suggest you read this:

 

 

 http://www.marke****ch.com/story/how-the-taxman-handles-child-care-2013-04-13

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Be careful that when you think you know what the law should mean, but don't know what the law actually means, especially when it comes to the IRS.

Also be careful when asking for legal advice on a message board.

I do suggest you read this:

http://www.marke****ch.com/story/how-the-taxman-handles-child-care-2013-04-13

This is the Internet. Everyone is a tax professional.

Seriously though. Thanks for the info.

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Thanks for that LKB.

 

On a side note..I find it a pain that we are bound to report all 1099 INT interest, even if Banks aren't required to send you a 1099-INT form if it's less than $10. 

 

I do wonder if I am the only one who tracks that $6.32 interest for the year down and reports it as income.

:P

 

 

Also..I've ****ed about it for years..but this might be the first year that I'm glad we ****ed up our withholdings. That extra $2k total back from the Fed/State is going to help with the new home/move/repairs to old home. Yay to poor W-4 planning.

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