Reduce Your Taxes with the Child Care Tax Credit

If you paid someone to care for a person in your household last year while you worked or looked for work, then you may be able to take the Child and Dependent Care Tax Credit and reduce the amount of tax owed.

Here are 12 facts you should know about this important tax credit:

  1. Child, Dependent or Spouse. You may be able to claim the credit if you paid someone to care for your child, dependent or spouse last year.
  2. Work-related Expenses. Your expenses for care must be work-related. This means that you must pay for the care so you can work or look for work. This rule also applies to your spouse if you file a joint return. Your spouse meets this rule during any month they are a full-time student. They also meet it if they’re physically or mentally incapable of self-care.
  3. Qualifying Person. The care must have been for “qualifying persons.” A qualifying person can be your child under age 13. A qualifying person can also be your spouse or dependent who lived with you for more than half the year and is physically or mentally incapable of self-care.
  4. Earned Income Required. You must have earned income, such as from wages, salaries and tips. It also includes net earnings from self-employment. Your spouse must also have earned income if you file jointly. Your spouse is treated as having earned income for any month that they are a full-time student or incapable of self-care. This rule also applies to you if you file a joint return. Please call if you have any questions about what qualifies as earned income.
  5. Credit Percentage / Expense Limits.The credit is worth between 20 and 35 percent of your allowable expenses. The percentage depends on the amount of your income. Your allowable expenses are limited to $3,000 if you paid for the care of one qualifying person. The limit is $6,000 if you paid for the care of two or more.
  6. Dependent Care Benefits. If your employer gives you dependent care benefits, special rules apply. For more information about these rules, please call the office.
  7. Qualifying Person’s SSN.You must include the Social Security Number of each qualifying person to claim the credit.
  8. Keep Records and Receipts. Keep all your receipts and records for when you file your tax return next year. You will need the name, address and taxpayer identification number of the care provider. You must report this information when you claim the credit.
  9. Form 2441. File Form 2441, Child and Dependent Care Expenseswith your tax return to claim the credit.
  10. Joint Return if Married. Generally, married couples must file a joint return. You can still take the credit, however, if you are legally separated or living apart from your spouse.
  11. Don’t overlook vacation and summer camps.Day camps are common during the summer months. Many parents pay for day camps for their children during school vacations while they work or look for work. If this applies to you, your costs may qualify for a federal tax credit that can lower your taxes.
  12. Certain Care Does Not Qualify.You may not include the cost of certain types of care for the tax credit, including:

We at Schaumburg CPA offer a complete range of International Taxation, Tax and Consulting Services. We are here not only to understand your needs but excelling on solutions to satisfy your needs. We are staying on top of current law changes and developing new relationships on a daily basis to serve your needs. Manendra Kothari is qualified Chartered Accountant from India and qualified and licensed CPA from US. .

Overnight camps or summer school tutoring costs.

Care provided by your spouse or your child who is under age 19 at the end of the year.

Care given by a person you can claim as your dependent.

Contact us :-847.524.0001

Visit us :-


CPA Firm in Hoffman Estates


Schaumburg area CPA firm you can trust. With over 30 years of experience, we operate under on principle: to provide exceptional, personalized client service in a simple to understand method. It is our belief that we offer the best service at the most competitive price in Hoffman Estates We are a full service tax, accounting, and wealth management firm helping small to mid sized businesses and individuals with comprehensive solutions at a fixed monthly cost.

When you run a Chicago, illinois area business, keeping accurate financial records is vital to the continued success and growth of that business. Hiring a professional bookkeeper from Manen Kothari CPA Chicago & Associates who specializes in small business accounting and small business bookkeeping services can help ensure your financial data is always up to date, accurate, and securely stored.

Tax Preparation Portal Hoffman Estates

Our client portal provides the two-way transfer of information. It provides you with convenient online storage in which your files can be easily uploaded, downloaded, stored and shared in a safe and secure environment.  You have quick access to your tax returns, financial statements, payroll returns, Business liability insurance , Business owner insurance, Retirement planning, Foreign bank account reporting , 1120 preparation , 1120s preparation, Property tax appeal, 2017 tax planning, Payroll tax compliance and many other vital documents 24/7 from anywhere with an Internet connection.

We are a full service tax, accounting, and wealth management firm helping small to mid sized businesses and individuals with comprehensive solutions at a fixed monthly cost. At Schaumburgcpa & Associates, we care about each of our clients and are happy to offer free initial consultations, so call us today!

Services include:

  • Income tax return preparation
  • E-filing of returns
  • Tax planning
  • Audit representation
Book-keeping & Payroll Solutions for Small Businesses
  • Book-keeping
  • Payroll
  • Financial Statements
  • Sales & Use Tax

By hiring a qualified CPA from Manen Kothari for your small business bookkeeping needs, you can focus on what really matters – your clients. All of our CPAs are experts in small business accounting and specialize in small business bookkeeping services. From inventory expenses to keeping track of expense accounts, Manen kothari is the name you can trust for thorough, high quality small business bookkeeping services in Schaumburg.

We understand how the latest federal, state and local tax legislation and other developments affect you and are constantly identifying new ways to reduce tax liabilities.

Contact us :-  847-524-0001.

Visit us :

Business Tax Planning Service in Schaumburg

Charge arranging is the procedure of taking a gander at different assessment alternatives keeping in mind the end goal to decide when, whether, and how to direct business and individual exchanges to lessen or dispense with expense risk.


Numerous little entrepreneurs overlook charge arranging. They don’t consider their assessments until it are an ideal opportunity to meet with their bookkeepers, however charge arranging is a progressing process and great duty counsel is profitable merchandise. It is to your advantage to survey your pay and costs month to month and meet with our Indian CPA or charge counselor quarterly to examine how you can exploit the procurement, credits and reasoning that are legitimately accessible to you.


Despite the fact that assessment shirking arranging is legitimate, charge avoidance – the decrease of expense through double dealing, subterfuge, or camouflage – is most certainly not. Every now and again what separates charge avoidance from assessment shirking is the IRS’s finding that there was deceitful expectation with respect to the entrepreneur. The accompanying are four of the ranges the Schaumburg IRS audit inspectors ordinarily concentrate on as indicating conceivable misrepresentation:


  • Failure to report generous measures of pay, for example, a shareholder’s inability to report profits or a store proprietor’s inability to report a segment of the everyday business receipts.


  • Claims for invented or despicable findings on an arrival, for example, a business agent’s significant exaggeration of travel costs or a citizen’s case of an extensive derivation for beneficent commitments when no check exists.


  • Accounting anomalies, for example, a business’ inability to keep satisfactory records or an inconsistency between sums covered a company’s arrival and sums gave an account of its money related proclamations.


  • Improper designation of salary to a related citizen who is in a lower assessment section, for example, where a company makes appropriations to the controlling shareholder’s youngsters.


Charge Planning Strategies


Incalculable assessment arranging techniques are accessible to little entrepreneurs. Some are gone for the proprietor’s individual assessment circumstance and some at the business itself, however paying little heed to how straightforward or how complex an expense methodology is, it will be founded on organizing the procedure to fulfill one or a greater amount of these regularly covering objectives:


  • Reducing the measure of assessable salary


  • Lowering your assessment rate


  • Controlling the time when the assessment must be paid


  • Claiming any accessible assessment credits


  • Controlling the impacts of the Alternative Minimum Tax


  • Avoiding the most well-known assessment arranging botches


So as to arrange adequately, you’ll have to assess your own and business wage for the following couple of years. This is fundamental since numerous assessment arranging procedures will spare duty dollars at one salary level, yet will make a bigger expense bill at other pay levels. You will need to abstain from having the “right” duty arrangement made “wrong” by incorrect salary projections. When you recognize what your rough wage will be, you can make the following stride: assessing your duty section.

The push to think of gem ball evaluations might be troublesome and by its exceptionally nature will be vague. Then again, you ought to as of now be anticipating your business incomes, salary, and income for general business arranging purposes. The better your evaluations are, the better the chances that your expense arranging endeavors will succeed.

Expanding Business Entertainment Expenses

Diversion costs are genuine reasonings that can bring down your assessment charge and spare you cash, if you take after specific rules.

With a specific end goal to qualify as a finding, business must be examined some time recently, amid, or after the dinner and the surroundings must be helpful for a business dialog. Case in point, a little, calm eatery would be a perfect area for a business supper. A club would not. Be cautious of areas that incorporate progressing floor appears or other diverting occasions that repress business dialogs. Prime diversions are theater areas, ski trips, greens, sports occasions, and chasing trips.

The IRS permits up to a 50 percent reasoning on excitement costs, however you should keep great records and the business supper must be masterminded with the motivation behind leading particular business. Bon craving!

Imperative Business Automobile Deductions

On the off chance that you utilize your auto for business, for example, going by customers or going to conferences far from your customary working environment you might have the capacity to take certain reasoning’s for the expense of working and keeping up your vehicle. You can deduct auto costs by taking either the standard mileage rate or utilizing real costs.

The mileage repayment rates for 2016 are 54 pennies for each business mile (57.5 pennies for each mile in 2015), 14 pennies for each altruistic mile (unaltered from 2015) and 19 pennies for moving and restorative miles (down from 23 pennies for every mile in 2015).

In the event that you possess two autos, another approach to expand findings is to incorporate both autos in your derivations. This works since business miles driven is dictated by business use. To figure business use, partition the business miles driven by the aggregate miles driven. This technique can bring about huge derivations.

Whichever technique you choose to use to take the reasoning, dependably make certain to keep precise records, for example, a mileage log and receipts. On the off chance that you require help making sense of which system is best for your business; don’t dither to get in touch with us. Glad driving!

Build Your Bottom Line When You Work At Home

The home office conclusion is potentially a standout amongst the most troublesome reasonings ever to come around the piece. Yet, there are such a large number of duty focal points it gets to be justified regardless of the navigational inconvenience. Here are a couple of regular tips for home office findings that can make charge season altogether less traumatic for those of you with a home office.

Attempt conspicuously showing your home telephone number and address on business cards, have business visitors sign a visitor log book when they visit your office, deduct long-separation telephone charges, keep a period and work action log, hold receipts and paid receipts. Keeping these receipts makes it such a great amount of less demanding to decide rates of derivations later on in the year.

Area 179 expensing for assessment year 2016 (as in 2015) permits you to quickly deduct, as opposed to devalue after some time, up to $500,000, with a top of $2,000,000 worth of qualified business property that you buy amid the year. The watchword is “buy”. Hardware can be new or utilized and incorporates certain product. All home office depreciable gear meets the capability. The “Reward Depreciation” for qualified resources (new hardware just – no utilized gear and no product) put in administration for expense years 2015, 2016, and 2017 is 50 percent. In 2018, it is diminished to 40 percent and in 2019 is decreased to 30 percent.

Our Schaumburg Tax Preparation services are proper and complete with full clarity. We deliver individual attention to all our clients and understand the ratio of customer satisfaction. We also service in the Schaumburg 1040 preparation and have grown to be among the leaders in CPA in Schaumburg.

Call us: 847.524.0001

For More Information Visit: