House Bill 1167 – Child and dependent care tax credit. Rep. Buell:
Provides a refundable income tax credit to individuals for certain household, child care, or dependent care expenses associated with an individual’s gainful employment. Provides that the amount of the credit is 50% of the federal child and dependent care credit. Provides that an individual whose federal adjusted gross income exceeds $45,000 is not eligible for the credit.
The legislation references section 21 of the Internal Revenue Code which specifies “employment-related expenses” as expenses for household services and care of the child, including daycare, if the expenses are incurred to enable gainful employment.
[tags]HB1167-2007, taxation[/tags]
The clause “associated with an individual’s gainful employment”, which appears to be the point of this bill, confuses me.
Who is this supposed to benefit?
If someone is working as a provider of day care services, can’t they already write off their business expenses on their taxes?
If this is supposed to reach people other than (presumably in-home) day care providers, then who? A person who gets paid by someone else to look after his or her own child? Short of child support payments from a separated or divorced partner, who does this?
Do child support payments even count as taxable income?