17 Year Old & Income

[acoburn]

So I have custody of both my special needs grand kids, I give my youngest daughter who is 17 some money to watch them. I think its about $6000 for the year give or take. I don't know the number off hand. Does she have to claim that, & can I claim the Child care/Dependent Credit?

[xmasbaby0]

You cannot get the childcare credit if the childcare provider is your own dependent teenage child; and at 17, she is still your dependent.    Sorry.

[LaShaunA3 · Accepted solution]

No, you can't claim the Child and Dependent Care Credit for payments made to your daughter. The IRS disallows the credit when the care provider is your child who's under age 19 at the end of the year. This is even if the care is legitimate and even if the children have special needs. 

 

Whether your daughter would need to file a tax return depends on if this is her only income. Since she's watching the children in your home, she is considered a household employee, so the payments are treated as wages. However, because she's your child and under age 21, her wages are exempt from Social Security and Medicare taxes.

 

If this is your daughter's only income, and it's below the dependent filing threshold for earned income, she may not be required to file a tax return. 

Who Can Take the Credit or Exclude Dependent Care Benefits?

Employment taxes for household employees 

 [Edited 2/10/26 | 5:39 pm PST]