Stay at home mom, working husband. Can we claim child care (pre-school fees)?

[jamesbond007]

Here's the thing. I read up on this. IRS says we can claim but if both parents are married filing jointly (we do) and one is working(I do) and the other is working or looking for a job. Now, how do we prove that my wife was looking for a job? Just curious? Is this a loophole?

[La Bibliotecaria Feroz]

If she is not looking for a job, you can't claim it.

A more honest loophole might be for her to actually have some earned income, even if it's not much and it's from self-employment. She could look into Appen or Leapforce or open an Etsy shop or something.

[NoStacheOhio]

Posting to follow.

I'm wondering about this a little bit myself. We elected the full FSA amount during open enrollment for 2016, and then my wife spent 10 months of 2016 without employment.

In our case, she was actually seeking employment, and has an email folder full of "Thank you for applying" type emails. I don't know what kind of substantiation we're looking at when we go to file. I'm hoping it's just a checkbox of "yes, I was seeking employment" or something.

[seattlecyclone]

I'm not sure why you would need to prove she was looking for work. What really matters is that she had some earned income. From the Form 2441 instructions (emphasis mine):

You can take the credit or the exclusion if all five of the following apply.

• Your filing status may be single, head of household, qualifying widow(er) with dependent child, or married filing jointly. If your filing status is married filing separately, see Married Persons Filing Separately, later.
• The care was provided so you (and your spouse if filing jointly) could work or look for work. However, if you did not find a job and have no earned income for the year, you cannot take the credit or the exclusion. But if you or your spouse was a full-time student or disabled, see the instructions for lines 4 and 5, later.
• The care must be for one or more qualifying persons.
• The person who provided the care was not your spouse, the parent of your qualifying child, or a person whom you can claim as a dependent. If your child provided the care, he or she must have been age 19 or older by the end of 2015, and he or she cannot be your dependent.
• You report the required information about the care provider on line 1 and, if taking the credit, the information about the qualifying person on line 2.

Agree with frugalparagon that a small side hustle would be beneficial; the amount of earned income needed to claim the full child care tax credit isn't that high ($3,000 if one kid, $6,000 if two or more).

[jamesbond007]

Aha. Thanks SeattleCyclone for the emphasis. I somehow managed to skip it until now. This clears things up.