If you’re a parent dreading tax day 2010, better luck next year. No, really, you could have double the luck in 2011 if President Obama’s new proposal goes through.
The president has suggested the child care tax credit for the middle class be almost doubled.
According to CNN, White House sources say the president will push to increase the Child and Dependent Care Tax Credit rate from 20 to 35 percent for families making under $85,000 a year. Families making from $85,000 to $115,000 also would see an increase in their tax credit under the proposal.
Right now families with two kids can claim up to $6,000 ($3,000 for one kid), but that number is misleading. The total you deduct has to equal just twenty percent of what you paid. So unless $6,000 is twenty percent, you’re not likely to get the full credit.
The new plan still wouldn’t get you up to that figure in most circumstances, but with fifteen percent more of what you pay to work with, it should help working families who are finding themselves shelling out a huge hunk of their paycheck just to ensure their kids are cared for so they can go to work.
Does the child care tax credit help your family?
More by this author: