How do I report babysitting income from my son for watching my grandson if we all live together (in the same home)?

[MichaelDC]

Do you want your son to report Babysitting income on his return? Do you want to claim childcare expenses?

[carmen-m-solis1]

My son pays me to babysit my grandson. We all live in the same house.  My son will report child care expenses on his taxes for paying me to watch my grandson. I do not want to claim child care expenses as we all share a household.

[MichaelDC]

Thanks for the clarification.

[carmen-m-solis1]

I make $400 a month for watching my grandson. Where would I input this income on my 2017 taxes?  Do I have to report this income since my son is reporting the child care expense on his taxes? Does it matter that we all share a household and that I am his mother?

[MichaelDC]

$400/month shouldn't affect any Social Security benefits you may be receiving unless you have another job elsewhere. It doesn't matter that you are in the same house. Before either of you file, see how this situation affects you both and determine if this is the way you want to do it. This could just be considered a gift from your son or some sort of cost-sharing agreement and neither of you would need to report this.

[MichaelDC]

Your son will need your Social Security Number in order to claim the childcare expenses on his return.The IRS will then expect to see your return claiming that income.

Since you didn't receive a 1099-MISC, you can report your babysitting income by following the instructions below: (Note: this is Self-Employment income subject to additional Social Security taxes on your profit after expenses.)

Please feel free to post any additional details or questions in the comment section.

Type “Schedule C” in the Search box and then select the “Jump to” link. This will take you to where you can enter any cash, personal checks or credit card payments (Form 1099-K) related to your self-employment. You may first be asked some general questions about your business. After you answer them, you’ll be taken to the Let's get income for (your line of work) screen where you can enter this income as Additional Income.

 As a self-employed babysitter, here are some additional expenses you can deduct:

·         Communication costs, for example cell phones, data plans, internet or wireless services, land or fax lines, long-distance charges, voicemail or answering services, call waiting, etc.

·         If also used for personal reasons (for example, internet service), then only the proportion used in business is allowed as an expense

·         Office supplies (paper, toner, writing instruments, etc.), software, stamps, envelopes, shipping materials, cleaning supplies

·         Any licenses or permits that are required for your profession

·         Fees and membership dues you paid to professional associations or unions

·         Continuing education or certification related to your work

·         Mileage accumulated during the course of your work

·         However, regularly commuting to and from a fixed office wouldn't qualify

·         Advertising costs, including business cards and websites

·         Fees for attorneys, consultants, accountants, and other professionals

·         Liability insurance, errors and omissions insurance, surety bonds

·         Credit card and bank fees

·         Health care premiums

·         CPR certification, first aid training

·         Miscellaneous supplies such as diapers, food, toys, books

·         Liability insurance

·         Advertising, including websites

·         Cell phones, data plans, second phone line

·         Vehicle expenses or standard mileage

·         Work-related education or training

·         Licenses and permits, membership dues

·         Fees for legal or professional services (Childcare only)

These out-of-pocket expenses will offset (reduce) your earnings, lowering the amount of income you pay taxes on.