Splitting daycare for two children with pro rata

[jdholbrook]

I have two children with my ex-wife. They both go to the same daycare and I get one statement monthly for them. I pay daycare directly and I deduct the appropriate amount from the alimony / child support payment monthly. We do not split 50/50, we have a pro rata of 66/34 with me paying the 66%. We each claim one child each year.

Last year daycare expenses were $10,623. So I paid all of that directly and that's what the documentation associated with the daycare's EIN will show which is where my concerns lie. The true number when considering the pro rata is $7011, but if I put that in when claiming my daughter TurboTax complains that the "amount entered for total amount paid to care providers does not equal the total of qualifying expenses given for all dependents." If I put $10k I'm overstating, if I put $7k it won't match what the daycare reports to the IRS.

How do I claim my daycare expenses in this situation?

Incidentally I put $5k into a DCRA account each year as well, although I don't believe that has any bearing.

[ThomasM125 · Accepted solution]

You should report the $7,011. It will be less than what is reported by the daycare center, so the IRS will not be concerned about it. They may only be concerned if you reported more than what the daycare reported.

Your allowed daycare expenses will be limited to the amount over what you contributed to the dependent care reimbursement account. That amount should be reported on your W-2 form and represents income that is not taxed. You can't get the tax benefit of that and take a dependent care credit for the same money.