Child care

[kathyc2]

I don't have one of these right now, so haven't done any research on it.  Just curious.

With the 2441 credits being significantly higher for 2021, a lot of people will come out better to take the credit than employer dependent care allowance.  Is there a way to make the W2 amount taxable and then take the credit?

[Pacun]

You will have to override in two places at least. The first will be to prepare the return without Child care and see how the amount Box 10 of W-2 Flows to the turn. Then you will have to override the W2 income amount on 1040. Then go to 2441 and override what is transferred from box 10 of W-2.  

I personally don't like to override an entry and 2 entries it is too much for me. 

[kathyc2]

I wasn't talking about software.  I was asking if it was allowed under law to opt to have W2 dependent care taxable in order to take advantage of 2441 credits.

Just putting it out there in case it can be done, and others didn't think of it.  Could be a big difference from some....

 

[Pacun]

I don't see any difference between this and a scholarship that becomes taxable in order to get the credit. 

Since this is new this year and unique, your guess is as good as mine but I hope someone else can give you a better answer.