I am a new father and fairly new spouse? How does child care expenses work with taxes?

It seems as if we can get money back paid to a babysitter that cannot be claimed on anyone's else taxes. Does our babysitter have to have some sort of day care license to qualify and I should pay the babysitter with checks to have some sort of payment proof? Please help..I am a new father and fairly new spouse? How does child care expenses work with taxes?
If the sitter does the job in your home, she is an household employee. You are responsible for paying half of the FICA tax, and withholding, if they request it.





More reasonable, is to take your child to some daycare home or daycare place, or the babysitter's home. She needs a license if it is required by state law. Most places, taking care of a kid or two does not require a license, and some states are more lenient than others. If she requires a license and doesn't have one, you cannot claim the dependent care deduction.





Checks are a good solution, as are records you keep. In reality, you will probably pay way more than the maximum you are allowed to deduct anyway.





If you or your spouse are ';stay at home,'; no deduction is allowed.I am a new father and fairly new spouse? How does child care expenses work with taxes?
If the child care is so both you and your spouse can work, fill out form 2441 and attach it to your return. You don't get anywhere near ALL the money back, but do get some of it taken off your tax bill if you have any tax liability.





It can be a private sitter, doesn't have to be a licensed daycare facility.





You should always pay with checks to have proof of payment. You don't have to provide it to the IRS unless they ask for it, but it's just good practice to have proof of payment.
If the sitter provides the service in your home, you are a household employer and have to withhold certain taxes and pay payroll taxes from the sitter's pay. See IRS Pub 926 http://www.irs.gov/pub/irs-pdf/p926.pdf for further information.





If you pay a sitter so that you (and your spouse, if married) can work OR you can work and your spouse attend school (or if your spouse is disabled and unable to care for your child) then you may qualify for the Child %26amp; Dependent Care Credit. See IRS Pub 503 http://www.irs.gov/pub/irs-pdf/p503.pdf for information on that. To claim the credit the provider cannot be a dependent on YOUR tax return but CAN be someone else's dependent.