Nanny Tax / Daycare Provider

[REFUNDMN]

This is my first time doing a client that hired a nanny in 2021.  My question is can the client still write off daycare expenses using form 2441 with the nanny’s information.  Thanks

[sjrcpa · Accepted solution]

Yes they can get the dependent care credit for wages paid to the nanny.

Of course they filed a W-2 and are completing Schedule H, right?

[REFUNDMN]

Yes and thank you.

[sjrcpa]

You're welcome.

[Karl]

I have this situation this year too.  Do you double-enter the care: once on Sch H and again for Form 2441?  I know this is a ProSeries post, but I'm on Lacerte.  Lacerte doesn't seem to be picking up the Sch H entries as eligible for 2441.

[taxiowa]

Reason Sch. H is not picking up 2441 eligible expenses is because Lacerte or any other software does not know what you are filing Schedule H for.  It could be your gardener or your wife's pool boy that you are paying as a household employee.  So enter it yourself on 2441.

[dkh]

lol.........your wife's pool boy ............lol     good one!

[TaxLi82]

Hi, 

I see I’m not getting credit for reporting day care expense to tax payer . Want to confirm it is because she worked as a self employed w/1099K and no w2 . Is this the reason ? 

[sjrcpa]

Self employment income counts as earned income for the dependent care credit. Does she have a profit or a loss?

[TaxLi82]

Loss

[IRonMaN]

And that is the real reason.