Dependent and care expenses

[Pacun]

Title should read "Child and dependent care credit"

Father leaves work because of illness in November 2008. Continues to receive paycheck until he dies in January 2009. His W-2 for 2009 shows $1500 income and wife 70K. They will file jointly in 2009 and will claim their two children ages 3 and 5, for whom she paid 7K in child care. Since he received a W-2 for $1500, form 2441 "Child and dependent care expenses" calculates the credit using the lower of the 6K and the lowest income from one of the parents (which is $1,500).

Keep in mind that father could not care for children because he was dying.

To make matters more interesting, wife participated on a pre-tax child care deduction at work. She put $5000 pre-tax and later collected those $5000 when she showed employer her child care expenses. ATX correctly is doing two things: Calculating 2441 using the fathers income $1500 and adding mother $3,500 to her income. Can they/she get some help since father was not able to take care of children?

[TAXBILLY]

Why not file father MFS and mother file HOH?

taxbilly

[TaxmannEA]

Why not file father MFS and mother file HOH?

taxbilly

That will only work if they did not live together for at least 6 months prior to year end ( or his death).

[TAXBILLY]

Didn't he die in January 2009, the first month of the tax year?

taxbilly

[SaraEA]

"If your spouse died during the year and you file a joint return as a surviving spouse, you are not considered married for purposes of the earned income limit. Use only your income in figuring the earned income limit." http://www.irs.gov/pub/irs-pdf/p503.pdf

[TAXBILLY]

"If your spouse died during the year and you file a joint return as a surviving spouse, you are not considered married for purposes of the earned income limit. Use only your income in figuring the earned income limit." http://www.irs.gov/pub/irs-pdf/p503.pdf

The question concerned child care, not EIC.

taxbilly

[Pacun]

Could the law also say that for child care expenses you are not considered married and you can use your income to qualify? Is that the route you are trying Sarah?