Are summer camps tax deductible?

The good news: If you pay a daycare center, babysitter, day camp, or other childcare provider, then you may qualify for the Child and Dependent Care Credit.

Childcare credits for the sunniest season

The Child and Dependent Care Credit provides tax relief for many parents with children under the age of 13 at the end of the tax year. There is no age limit if the child is disabled. Though the credit is largely for working parents or guardians, it can also apply to taxpayers who were full-time students or unemployed for part of a given tax year. This is also open to parents who are actively looking for work.

In 2022, the average price of day camps clocked in at around $178 per day, according to the National Camp Association. Therefore, it’s crucial to plan ahead and make sure you save all the receipts and documentation for any childcare. For the day camp, babysitter, or any other childcare provider, you’ll need their name, address, tax identification number (either their Social Security number or employer identification number), and the total amount paid.

You may be eligible for up to 35% of the total amount you paid, up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual, or $6,000 for two or more qualifying individuals to figure out the credit amount. Your tax credit percentage depends on your adjusted gross income.

The credit rate ranges from 20% to 35% of expenses, depending on your income. The 35% rate applies if your income is under $15,000, the 20% rate if your income is over $43,000, according to the IRS.

As with all things having to do with taxes, it’s best to discuss this with a professional who can help navigate the ins and outs.

Overnight camps don’t make the cut

One important caveat is that these credits are only available for summer day camps, not for overnight camps. So, as you’re planning for the summer, this should be taken into consideration if you’d like to take advantage of these tax credits. 

A year-round resource

If you’re looking for help with how to plan and save on taxes throughout the year as a parent, our Tax Pros can help you keep track of your household and childcare expense spending.

Stay informed and stay on top of your taxes by finding an office near you.

About the Author

Jo Willetts, Director of Tax Resources at Jackson Hewitt, has more than 35 years of experience in the tax industry. As an Enrolled Agent, Jo has attained the highest level of certification for a tax professional. She began her career at Jackson Hewitt as a Tax Pro, working her way up to General Manager of a franchise store. In her current role, Jo provides expert knowledge company-wide to ensure that tax information distributed through all Jackson Hewitt channels is current and accurate.

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