Adrienne is a single mother with a 6-year-old daughter who lived with her during

Question

Adrienne is a single mother with a 6-year-old daughter who lived with her during the entire year. Adrienne paid $2,400 in child care expenses so that she would be able to work. Of this amount, $500 was paid to Adrienne’s mother whom Adrienne cannot claim as a dependent. Adrienne had net earnings of $2,800 from her jewelry business. In addition, she received child-support payments of $20,800 from her ex-husband.

Use the appropriate tax tables or tax rate schedules.

Adjusted gross income Applicable income
  $15,000 or less 35%
    15,001 – 17,000 34     
    17,001 – 19,000 33     
    19,001 – 21,000 32     
    21,001 – 23,000 31     
    23,001 – 25,000 30     
    25,001 – 27,000 29     
    27,001 – 29,000 28     
    29,001 – 31,000 27     
    31,001 – 33,000 26     
    33,001 – 35,000 25     
    35,001 – 37,000 24     
    37,001 – 39,000 23     
    39,000 – 41,000 22     
    41,001 – 43,000 21     
    43,001 or more 20     

What amount, if any, of child and dependent care tax credit can Adrienne claim? (Round your final answers to 2 decimal places.)

Explanation / Answer

Maximum credit allowable for one child is $3000

child care expense = 2400 - 500(disallowed) =$1900

Credit available rate according to the income of $2800 = $1900 * 35%

= $665

Adrienne claim for child and dependent care tax credit is $665

Note:- Child support payment received is not taxable ,It is not considered as income for the payee.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.