Problem 12-36 (LO. 4) Paul and Karen Kent are married, and both are employed (Paul earned $44,000 and Karen earned $9,000 this year) Paul and Karen hav two dependent children, Samuel and Joy, both under the age of 13. In order to work, Paul and Karen pay $3,800 ($1,900 for each child) Sunnyside Day Care Center (422 Sycamore Road, Ft. Worth, TX 76028; Employer Identification Number: 11-2345678), to care for their children. Click to view Applicable Rate of Credit based on Adjusted Gross Income. a. Assuming that Paul and Karen file a joint return, their tax credit for child and dependent care expenses for the year is $ 760. Feedback b. Complete Form 2441 for Paul and Karen: their AGI is $53,750, and their tax liability before any available child care credit is $2,825 Relevant Social Security numbers are as follows: Paul (123-45-6789): Sam (123-45-6788); Joy (123-45-6787). Neither Paul nor Karen received any child care benefits from their employers. Enter amounts as positive numbers. OMB No. 1545-0074 Form 2441 Child and Dependent Care Expenses Attach to Form 1040, Form 1040A, or Form 1040NR. Information about Form 2441 and its separate 2016 040A Department of the Treasury Internal Revenue Service (99) 2441 instructions is at www.irs.gov/form2441 Sequence No. 21 Name(s) shown on return Paul and Karen Kent Your social security number 123-45-6789 Persons or Organizations Who Provided the Care-You must complete this part. Part I (If you have more than two care providers, see the instructions.) 1 (a) Care provider's(b) Address (number, street, apt. no., city, (c) Identifying number (d) Amount paid (see state, and ZIP code) (SSN or EIN) name Sunnyside Day Care Center 422 Sycamore Road Ft. Worth, TX 76028 11-2345678 3,800 Complete only Part II below. No Did you receive dependent care benefits? Yes Complete Part III on the back next. Caution: If the care was provided in your home, you may owe employment taxes. If you do, you cannot file Form 1040A. For details, see the instructions for Form 1040, line 60a, or Form 1040NR, line 59a Part Credit for Child and Dependent Care Expenses Information about your qualifying person (s). If you have more than two qualifying persons, see the instructions. 2 (a) Qualifying person's name (b) Qualifying person's social security number (c) Qualified expenses you incurred and paid in 2016 for the person listed in column (a) First Last 1,900 Samuel Kent 123-45-6788 1,900 Joy Kent 123-45-6787 Add the amounts in column (c) of line 2. Do not enter more than $3,000 for one qualifying person or $6,000 for two or more persons. If you completed Part II, enter the 3 3,800 Enter your earned income. See instructions 5 If married filing jointly, enter your spouse's earned income (if you or your spouse was 5 student or was disabled, see the instructions); all others, enter the amount from line 4 Enter the smallest of line 3, 4, or 5. . . .. . . 3,800 Enter the amount from Form 1040, line 38: Form 1040A, line 22: or Form 1040NR, line 37.. 7 53,000X Enter on line 8 the decimal amount shown below that applies to the amount on line 7 8 If line 7 is: If line 7 is: Decimal But not But not Over amount is amount is $0-15,000 15,000-17,000 17,000-19,000 19,000 21,000 21,000-23,000 23,000-25,000 25,000-27,000 27,000-29,000 35 529,000-31,000 31,000-33,000 33,000-35,000 35,000-37,000 37,000-39,000 39,000-41,000 41,000-43,000 43,000-No limit 34 .26 8 32 31 30 Multiply line 6 by the decimal amount on line 8. If you paid 2015 expenses in 2016, see 9 9 760 Tax liability limit. Enter the amount from the Credit Limit Worksheet in the instructions ._. . . 10 10 .. .. Credit for child and dependent care expenses. Enter the smaller of line 9 or line 10 here and on Form 1040, line 49: Form 1040A, line 31; or Form 104ONR, line 47..... 11 For Paperwork Reduction Act Notice, see your tax return instructions. Form 2441 (2016) Cat. No. 11862M Problem 12-36 (LO. 4) Paul and Karen Kent are married, and both are employed (Paul earned $44,000 and Karen earned $9,000 this year) Paul and Karen hav two dependent children, Samuel and Joy, both under the age of 13. In order to work, Paul and Karen pay $3,800 ($1,900 for each child) Sunnyside Day Care Center (422 Sycamore Road, Ft. Worth, TX 76028; Employer Identification Number: 11-2345678), to care for their children. Click to view Applicable Rate of Credit based on Adjusted Gross Income. a. Assuming that Paul and Karen file a joint return, their tax credit for child and dependent care expenses for the year is $ 760. Feedback b. Complete Form 2441 for Paul and Karen: their AGI is $53,750, and their tax liability before any available child care credit is $2,825 Relevant Social Security numbers are as follows: Paul (123-45-6789): Sam (123-45-6788); Joy (123-45-6787). Neither Paul nor Karen received any child care benefits from their employers. Enter amounts as positive numbers. OMB No. 1545-0074 Form 2441 Child and Dependent Care Expenses Attach to Form 1040, Form 1040A, or Form 1040NR. Information about Form 2441 and its separate 2016 040A Department of the Treasury Internal Revenue Service (99) 2441 instructions is at www.irs.gov/form2441 Sequence No. 21 Name(s) shown on return Paul and Karen Kent Your social security number 123-45-6789 Persons or Organizations Who Provided the Care-You must complete this part. Part I (If you have more than two care providers, see the instructions.) 1 (a) Care provider's(b) Address (number, street, apt. no., city, (c) Identifying number (d) Amount paid (see state, and ZIP code) (SSN or EIN) name Sunnyside Day Care Center 422 Sycamore Road Ft. Worth, TX 76028 11-2345678 3,800 Complete only Part II below. No Did you receive dependent care benefits? Yes Complete Part III on the back next. Caution: If the care was provided in your home, you may owe employment taxes. If you do, you cannot file Form 1040A. For details, see the instructions for Form 1040, line 60a, or Form 1040NR, line 59a Part Credit for Child and Dependent Care Expenses Information about your qualifying person (s). If you have more than two qualifying persons, see the instructions. 2 (a) Qualifying person's name (b) Qualifying person's social security number (c) Qualified expenses you incurred and paid in 2016 for the person listed in column (a) First Last 1,900 Samuel Kent 123-45-6788 1,900 Joy Kent 123-45-6787 Add the amounts in column (c) of line 2. Do not enter more than $3,000 for one qualifying person or $6,000 for two or more persons. If you completed Part II, enter the 3 3,800 Enter your earned income. See instructions 5 If married filing jointly, enter your spouse's earned income (if you or your spouse was 5 student or was disabled, see the instructions); all others, enter the amount from line 4 Enter the smallest of line 3, 4, or 5. . . .. . . 3,800 Enter the amount from Form 1040, line 38: Form 1040A, line 22: or Form 1040NR, line 37.. 7 53,000X Enter on line 8 the decimal amount shown below that applies to the amount on line 7 8 If line 7 is: If line 7 is: Decimal But not But not Over amount is amount is $0-15,000 15,000-17,000 17,000-19,000 19,000 21,000 21,000-23,000 23,000-25,000 25,000-27,000 27,000-29,000 35 529,000-31,000 31,000-33,000 33,000-35,000 35,000-37,000 37,000-39,000 39,000-41,000 41,000-43,000 43,000-No limit 34 .26 8 32 31 30 Multiply line 6 by the decimal amount on line 8. If you paid 2015 expenses in 2016, see 9 9 760 Tax liability limit. Enter the amount from the Credit Limit Worksheet in the instructions ._. . . 10 10 .. .. Credit for child and dependent care expenses. Enter the smaller of line 9 or line 10 here and on Form 1040, line 49: Form 1040A, line 31; or Form 104ONR, line 47..... 11 For Paperwork Reduction Act Notice, see your tax return instructions. Form 2441 (2016) Cat. No. 11862M