Level 15

Deductions & credits

Q. If 12,000 is paid to a grandparent of a child in a tax year, can this be claimed for the child care credit?

A. Yes. All that's needed is for the parent to provide the baby sitter's SS# on the IRS form 2441.


Q.  If so, would the grandparent still need to do the 1099-misc to claim the income?

A.  No.  The grandparent  does not need any form from the parent.  The grandparent reports the income based on their own records.


Q. Does grandparent need a form, from parent, to get the HSH notation on the 1040 form?

A.  No.  There is no form to input to make that happen.  The grandparent just need to know how to enter in TT (described above).


Q. With such a high amount, is it necessary to withhold taxes?

A. There's no need to make the parent do withholding. Grandparent can make quarterly estimated payments if needed.


Q. As a grandparent, are they exempt from SET.

A. Only if the grandparent babysits in the parent's home, as discussed above.