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Tax help for working parents Logo aicpa

  Free |   AICPA |   01 Nov 2016 |   Journal of Accountancy

As things stand, high child care costs can make wage earning for many parents seem like an exercise in the law of diminishing returns. Tax credits, especially in states offering more generous credits, may make the economics more feasible for lower-income taxpayers and provide at least a slight offset for middle-income workers. Employer-provided child care could be a better remedy, but statistics for the federal business credit suggest it is not widely offered. Going forward, fresh proposals could gain traction, but in the meantime, working parents can at least seek out the best options for high-quality care and make sure they claim all available tax benefits. 

Topics covered:
  • Tax: Technical: Individual income taxation , Intermediate
  • Tax: Technical: Employee benefits, Intermediate