With Labor Day weekend behind us, it is amazing how quickly retail outlets switch their offerings towards the next holiday. Some stores will be enthralled with Halloween candy and costumes, while others are skipping the scary season altogether and trotting out holiday garnishments.
With the effort to get people thinking about how to spend money on the next holiday, some effort should be made about preparing for next year’s tax season. Believe it or not, school shopping could save you some money come next April. This post will provide some insight on deductions for school supplies and child care costs.
The Child and Dependent Care Tax Credit – This is a fairly common tax credit, but it is worth noting that could be worth as much as 35 percent of your tax bill. It is applied to the first $3,000 in qualifying expenses for one child, and is extended to $6,000 in expenses for two children.
After school care – If you pay for child care in the morning (before school) and during the afternoon hours, the costs stemming from this care could be tax deductible.
Pre-kindergarten – In the same vein, tuition for pre-kindergarten and other forms of early education programs could be tax deductible.
Be wary of school donations – School donations are generally tax deductible. However, parents must be wary that donations made to your child’s school should be for the benefit of all children. In essence, paying tuition for compulsory education may not be tax deductible.
If you have questions regarding education based tax deductions, an experienced tax attorney can help.