Comments on: The Child and Dependent Care Credit Sucks (Or How You Can Tell That Congress is Full of Men) http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/ Paying taxes is painful... but reading about them shouldn't be. Sat, 07 Nov 2009 20:18:36 -0500 http://wordpress.org/?v=2.8.5 hourly 1 By: Taxes, Bootstrapping and Being Parents Don’t Mix « the talking trekaroo http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-10122 Taxes, Bootstrapping and Being Parents Don’t Mix « the talking trekaroo Wed, 15 Apr 2009 08:36:49 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-10122 [...] Tax Girl critises this tax law for other reasons: The Child and Dependet Care Credit Sucks [...] [...] Tax Girl critises this tax law for other reasons: The Child and Dependet Care Credit Sucks [...]

]]> By: Robert http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-8868 Robert Thu, 12 Feb 2009 21:39:48 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-8868 First off, to those tired of "supporting" other people's children, get over it! We are part of a society and part of a society's responsibilities is to prepare the next generation of citizens. This includes education, parks, and supporting parent friendly programs. I'd like to see where the country would be in 30 years if everyone decided to stop having children. For an small example, look to Japan's stalled economy over the last 20 years. Just because you have decided not to take on the sacrifice of having children of your own, doesn't mean you don't have a responsibility to the future of this country. And you claim we want Uncle Sam to pay for our child care, but you are dead wrong. I have no problem paying for child care, but why should we have to pay taxes on the amount we have to pay? It's not like this is a luxury we are trying to deduct here. Really it's a business expense, because we have to pay for child care in order to go to work! We are just trying to make ends meet here. We pay about $16,500/year to have just 2 kids in daycare. My wife makes about $32,000/year. So over half of her gross pay goes to daycare. Take out taxes and it's about $26,000/year or $2166/month even with the tax credit allowance. Then take out daycare and it's $9500/year or $792/month to take home. It's not much, but we need it. And remember people, we don't get $6000, we only get a percentage of that, around $1500, deducted from our taxes. I/12t isn't free money from the government! Basically, my wife works hard 40 hours a week to bring home $800/month after taxes and child care. If we could deduct the entire $16,500 instead of just $6000, we could keep another $200/month. We aren't looking for a handout, just to keep a little more of our hard earned money. Stop taxing child care! P.S. To magpie: If you have a dependent care flex account, you can still take the credit, but you have to subract the $5000 you contibuted tax free to the account from the $6000, meaning you can claim a $1000 allowance for the credit. I don't know why they just don't allow you to contribute $6000 to the account! That's Congress and the IRS for you! First off, to those tired of “supporting” other people’s children, get over it! We are part of a society and part of a society’s responsibilities is to prepare the next generation of citizens. This includes education, parks, and supporting parent friendly programs. I’d like to see where the country would be in 30 years if everyone decided to stop having children. For an small example, look to Japan’s stalled economy over the last 20 years. Just because you have decided not to take on the sacrifice of having children of your own, doesn’t mean you don’t have a responsibility to the future of this country.

And you claim we want Uncle Sam to pay for our child care, but you are dead wrong. I have no problem paying for child care, but why should we have to pay taxes on the amount we have to pay? It’s not like this is a luxury we are trying to deduct here. Really it’s a business expense, because we have to pay for child care in order to go to work! We are just trying to make ends meet here.

We pay about $16,500/year to have just 2 kids in daycare. My wife makes about $32,000/year. So over half of her gross pay goes to daycare. Take out taxes and it’s about $26,000/year or $2166/month even with the tax credit allowance. Then take out daycare and it’s $9500/year or $792/month to take home. It’s not much, but we need it.

And remember people, we don’t get $6000, we only get a percentage of that, around $1500, deducted from our taxes. I/12t isn’t free money from the government!

Basically, my wife works hard 40 hours a week to bring home $800/month after taxes and child care. If we could deduct the entire $16,500 instead of just $6000, we could keep another $200/month. We aren’t looking for a handout, just to keep a little more of our hard earned money. Stop taxing child care!

P.S. To magpie: If you have a dependent care flex account, you can still take the credit, but you have to subract the $5000 you contibuted tax free to the account from the $6000, meaning you can claim a $1000 allowance for the credit. I don’t know why they just don’t allow you to contribute $6000 to the account! That’s Congress and the IRS for you!

]]> By: Deborah Beckett http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-8158 Deborah Beckett Thu, 08 Jan 2009 11:14:22 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-8158 IMO the real purpose of the child care tax credit is to force home-based care providers to declare their income to the IRS and pay taxes. The credit is not enough to help working parents in a meaningful way or even to "encourage working". But it's enough that the working parents are not going to pass it up. To claim it, they must submit the care provider's SSN on their tax return (or identify the care provider by name and indicate that the provider refused to give the SSN). Either way a care provider that does not declare the income is going to be in hot water with the IRS. Prior to this credit, most home-based care providers could earn $20-40K/year or more under the table. Not only not paying taxes on it, but also maintaining eligibility for assistance like food stamps, WIC, earned income credit, medicaid, etc. So it's a bigger issue than just making sure the IRS gets its due. IMO the real purpose of the child care tax credit is to force home-based care providers to declare their income to the IRS and pay taxes. The credit is not enough to help working parents in a meaningful way or even to “encourage working”. But it’s enough that the working parents are not going to pass it up. To claim it, they must submit the care provider’s SSN on their tax return (or identify the care provider by name and indicate that the provider refused to give the SSN). Either way a care provider that does not declare the income is going to be in hot water with the IRS.

Prior to this credit, most home-based care providers could earn $20-40K/year or more under the table. Not only not paying taxes on it, but also maintaining eligibility for assistance like food stamps, WIC, earned income credit, medicaid, etc. So it’s a bigger issue than just making sure the IRS gets its due.

]]> By: magpie http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-6899 magpie Tue, 21 Oct 2008 19:02:22 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-6899 Right - and if you're lucky enough to have a dependent care flex account, you're limited to $5K. Right – and if you’re lucky enough to have a dependent care flex account, you’re limited to $5K.

]]> By: Jessie http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-6897 Jessie Tue, 21 Oct 2008 18:28:11 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-6897 Just to add..........I think this is the worst country I have lived in for child allowances. In Europe ( a place where Americans consider inferior to them) gives up to 2 years sometimes for maternity leave (in comparison to the meager 6 weeks here....and even then it's a hassle to get those 6 meager weeks). Imagine having to give your 6 week old little baby to a stranger while you have to go out to work? And a tax free child allowance is given EVERY month for EACH child in a household regardless of how much you make. This is not something claimed by spongers but is given automatically once the child is born and is every month up until they're 18. What a great way to ensure the future of your country and what a great way to give many parents the ability and more importantly, the choice to stay home and care for their children instead of having to dump them off at a mass daycare with no one on one care and attention. Just to add……….I think this is the worst country I have lived in for child allowances. In Europe ( a place where Americans consider inferior to them) gives up to 2 years sometimes for maternity leave (in comparison to the meager 6 weeks here….and even then it’s a hassle to get those 6 meager weeks). Imagine having to give your 6 week old little baby to a stranger while you have to go out to work? And a tax free child allowance is given EVERY month for EACH child in a household regardless of how much you make. This is not something claimed by spongers but is given automatically once the child is born and is every month up until they’re 18. What a great way to ensure the future of your country and what a great way to give many parents the ability and more importantly, the choice to stay home and care for their children instead of having to dump them off at a mass daycare with no one on one care and attention.

]]> By: Jessie http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-6896 Jessie Tue, 21 Oct 2008 18:21:43 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-6896 So, I see a lot of you out there disagree with the child tax credit and moan and complain about paying taxes that you think go to supporting parents who want to work. Do you also disagree that this country should support the unemployed? I mean, based on your comments why should we support someone whoe gives nothing or who pays no taxes. You are essentially supporting people who chose not to work. Some people lose their jobs due to the company failing and is not a choice by them. What about disability? Do you also disagree that you should not pay taxes to support people who cannot work and who have children? Would you prefer they starve and their children die due to neglect? While I agree to some extent that people should be able to afford the kids they have I also agree whole heartedly that they should be given some kind of relief for the daycare expense they are forced to pay so that they can work and contribute to the taxes of this country. If it wasn't for the government raising interest rates/housing and making things so much more expensive both parents may not have to work in order to keep food on the table. It's a long time since the ideal 50's where the dad earned enough for all and the mother could stay home with the kids. This country needs to wake up to that. In addition these children are the future of this country and do you expect the government to ignore the future of this country? I must admit though that I do agree the place is full of men because the plan is absolutely retarded. I would love to see them survive on the maximum wage they have crated and the maximum credit. Let's see them try. So, I see a lot of you out there disagree with the child tax credit and moan and complain about paying taxes that you think go to supporting parents who want to work. Do you also disagree that this country should support the unemployed? I mean, based on your comments why should we support someone whoe gives nothing or who pays no taxes. You are essentially supporting people who chose not to work. Some people lose their jobs due to the company failing and is not a choice by them. What about disability? Do you also disagree that you should not pay taxes to support people who cannot work and who have children? Would you prefer they starve and their children die due to neglect? While I agree to some extent that people should be able to afford the kids they have I also agree whole heartedly that they should be given some kind of relief for the daycare expense they are forced to pay so that they can work and contribute to the taxes of this country. If it wasn’t for the government raising interest rates/housing and making things so much more expensive both parents may not have to work in order to keep food on the table. It’s a long time since the ideal 50’s where the dad earned enough for all and the mother could stay home with the kids. This country needs to wake up to that. In addition these children are the future of this country and do you expect the government to ignore the future of this country? I must admit though that I do agree the place is full of men because the plan is absolutely retarded. I would love to see them survive on the maximum wage they have crated and the maximum credit. Let’s see them try.

]]> By: Gordon http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-5258 Gordon Fri, 09 May 2008 17:40:07 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-5258 It sounds to me like you want the government to pay for your child care. Here's one thing I can guarantee. The day the government increases the Child Care Credit you'll see an increase in the Day Care prices almost proportionate. The same thing happens with student loans. The feds increase the programs, schools see an opportunity to jack up tuition. I have a client who earned $90,000 last year and paid no federal income tax; yet another had a liability of $8,0000, is it fair to have that disparity based on life choices? It sounds to me like you want the government to pay for your child care.

Here’s one thing I can guarantee. The day the government increases the Child Care Credit you’ll see an increase in the Day Care prices almost proportionate.

The same thing happens with student loans. The feds increase the programs, schools see an opportunity to jack up tuition.

I have a client who earned $90,000 last year and paid no federal income tax; yet another had a liability of $8,0000, is it fair to have that disparity based on life choices?

]]> By: Velveteen Mind - Megan http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-5259 Velveteen Mind - Megan Fri, 09 May 2008 13:06:12 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-5259 Okay, this post is what I needed for that interview yesterday with NBC Nightly News. I was trying to explain why we decided that, for now, it is more beneficial across the board for me to stay home, but I didn't have clear numbers to offer. Grrrrrrr. Okay, this post is what I needed for that interview yesterday with NBC Nightly News. I was trying to explain why we decided that, for now, it is more beneficial across the board for me to stay home, but I didn’t have clear numbers to offer.

Grrrrrrr.

]]> By: Fix the Tax Code Friday: Child Related Exemptions and Credits http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-5260 Fix the Tax Code Friday: Child Related Exemptions and Credits Fri, 09 May 2008 10:51:45 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-5260 [...] there’s been some discussion on the blog lately about whether or not parents should receive tax “benefits” in the [...] [...] there’s been some discussion on the blog lately about whether or not parents should receive tax “benefits” in the [...]

]]> By: Keith http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/comment-page-1/#comment-5261 Keith Thu, 08 May 2008 22:26:16 +0000 http://www.taxgirl.com/the-child-and-dependent-care-credit-sucks-or-how-you-can-tell-that-congress-is-full-of-men/#comment-5261 Just another way for the government to decide how much of our own hard earned money each of us need to live on. Just another way for the government to decide how much of our own hard earned money each of us need to live on.

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