Benefits Compliance Question

Question: Do summer day camp expenses for dependents count towards an employee’s Child and Dependent Care tax credit?

Answer: Yes, summer day camps are eligible expenses for the Child and Dependent Care tax credit. The purpose of the credit is to allow working parents to have childcare for their children who are under the age of 13 during the summer. The costs of the summer day camp are eligible for the credit. The amount of the credit differs from employee to employee based on income and a percentage of expenses incurred for the care of the child to enable the taxpayer to work, look for work, or attend school. While summer day camps are eligible for the credit, overnight summer camps are not. The IRS’s reasoning is that sending a child to an overnight camp is not considered a work-related expense.