@rontana1 wrote:
1. I don't know.
2. No. Only businesses need to issue 1099s.
3. See 2.
4. You still need to file form 2441 to reconcile the DCFSA with your spending. The DCFSA is reported in box 10 of your W-2 so Turbotax will require you to complete the form. You will indicate how much you paid for qualified care, and also how much money was either forfeited or carried forward to 2021 in the account. If all the money was either spent for qualified care or forfeited, you won't owe any additional tax, but you have to report it so form 2441 resolves the W-2 box 10 amount.
5. Normally for a business she would include a schedule C in her return. She reports the income, deducts expenses, and pays income tax plus self-employment tax on the net profit. Expenses for a home day care can include meals and a share of the rent or mortgage, utilities and so on. Although the household expenses might be a small amount for only 3 weeks.
Since this is not an ongoing trade or business, she could report it as hobby income, and only pay income tax and not the self-employment tax, but she can't deduct expenses.
