Summer Day Camp & Your Taxes

Child and Dependent Care credit may cover more than you think come tax season.  If your child enjoys summer day camps, from arts and crafts to water polo, those expenses generally count as allowable expenses.  The credit was created as a way to help working parents. It serves to reduce the amount of federal income tax due and it varies depending on earned income.  There are several requirements to consider, but many taxpayers overlook these deductions when preparing for tax season. We discussed the specifics of dependent care in Whom May I Claim As a Dependent, and the following provides more specific information for summer day camps.

 There are several requirements to claim day camp expenses under the Child and Dependent Care credit.  Campers must be under the age of 13 and the camp cannot be an overnight one. However, you may select any day camp that you like, even if it’s not the least expensive.  The purpose of sending your child to the camp must be to provide care for the child while parents are working. In this way, camp expenses are comparable to daycare or babysitting fees paid to allow parents to work.  The camper must be you or your spouse’s direct dependent. You also need to pay for the camp above the table. While camp expenses are covered, equipment needed to participate in the camp does not count. If either parent is a stay at home parent or otherwise not actively seeking employment, the family does not qualify for this credit.    Finally, credit is not available if the day camp provider is your spouse, dependent, or the parent of the child.  

The tax credit allowed is 35% of expenses up to $3,000 for one child and $6,000 for 2 or more campers.  At tax time you will need a federal form 2441 attached to your 1040, 1040A, or 1040NR.  In order to claim this credit, you cannot use 1040EZ forms.

To see if the Child and Dependent Care credit is applicable to summer camp fees you may have paid this summer, see IRS Publication 503, Child and Dependent Care Expenses, for more information.