Family member lives with us and cares for children for a weekly salary. Can I claim salary for credit if family is not added as dependent on return?

[tygrtchr · Accepted solution]

If the family member receives a salary, then he/she is your employee.  In order to get "credit" for the child care salary, you must issue the family member a W-2 or 1099-MISC since you are the employer.  (This should have been done by January 31.) Your family member must claim the income as self-employment and pay the appropriate taxes.  Basically, you can't claim payment made to someone who does not report it as income.