Question

I have a question regarding childcare credit. I make my childcare payments in cash, and my childcare provider doesn’t want to report that income. Can I sill claim the childcare tax credit?

Answer

Yes. If you’re eligible to claim the childcare tax credit, you can claim it if the person you paid doesn’t report the income. Report the caregiver’s costs on Form 2441: Child and Dependent Care.

To claim the credit, you’ll provide the caregiver’s:

  • Name
  • Address
  • Taxpayer identification number, which can be a Social Security number (SSN)

If the caregiver doesn’t claim the income, the IRS will likely follow up with both of you regarding the unreported income. If so, the caregiver will have to report the income and might be subject to penalties.

Related Topics

Related Resources

Tax Deductions and Credits for Young Adults

As a young adult or millennial, taxes may be a new responsibility. Learn more about common deductions & credits for young adults with H&R Block.

Dependent Relationship Options

Confused by dependent relationship options? Find out how to choose the right option. Get tax answers at H&R Block.

2020 Stimulus payment information

The IRS is providing stimulus payments to the majority of Americans. Find out how the IRS will send your payment with answers from the experts at H&R Block.

IRS Change of Address

How do you notify the IRS of address changes? Learn more about Form 8822 and get answers from the tax experts at H&R Block.