The Child and Dependent Care Tax Credit (CDCTC) offers a useful tool for families in need of financial assistance. Human resource managers can employ consultants to provide resources regarding tax deductions, employee benefits and other ways to save workers money.
Employees can take advantage of the CDCTC if they paid a babysitter, nanny or caregiver to watch a child or dependent so they could continue working. The credit allows workers to reduce their federal income tax, offering a credit between 20 percent and 35 percent up to $3,000 for children under the age of 13. Family income and the number of children can impact the non-refundable credit.
The IRS has created guidelines families must follow to receive the credit. People must identify the care provider, specify the dollar amount of the care and show the care has been provided to allow a person to work or search for a job.
Employee benefits consulting allows employers to receive expert advice that helps them understand how the CDCTC works. Consultants deliver tools and research human resource managers can use to give workers options to help them maximize their federal income tax refund.
