rom 2441

Department of the Treasury
Internal Revenue Service

D> Attach to Form 1040

Expenses for Household and Dependent Care Services

1972

Name(s) as shown on Form 1040

| Your social security number

Computation of deduction for household and dependent care services

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a

11

12
13

14

Monthly amounts incurred for services in the
household for:

(a) Child(ren) under 15 years of age .
(b) Disabled dependent 15 years of age or over .
(c) Disabled wife (husband) .

Monthly amounts incurred for services out-
side the household for care of a child(ren)
under 15 years of age. Enter lesser of amount
incurred or $200 for one, $300 for two, or
$400 for three or more. . . . - -

Total (add lines 1(a), 1(b), 1(c), and 2) .

If the sum of adjusted gross income and di
ability income received this year by your di:
abled dependent 15 years of age or over is
larger than $750, divide the amount over
$750 by the number of months in which you
have listed amounts on line 1(b). Enter this
result or the monthly amount on line 1(b),
whichever is smaller, in each monthly column
in which an amount is listed on line 1(b) .

If your disabled wife (husband) received d
ability payments, divide the total disability
payments received this year by the number of
months in which you have listed amounts on
line 1(c). Enter this result or the monthly
amount on line 1(c), whichever is smaller, in
each monthly column in which you have an
amount listed on line 1(c) . Loe

Total (add lines 4and5) . . . . .
Subtract line 6 fromline3 . 2. .

Monthly limitation . Lo
Enter lesser of line 7 or line 8 .

If your adjusted gross income (line 17, Form
1040) is larger than $18,000, divide the
amount over $18,000 by 24. Enter this result
in each monthly column in which you have an
amount listed on line 3. 2. 2 | .

Subtract line 10 from line 9. If line 10 is
greater than line 9, enter “O”. . . .

Add amounts on line 11 and enter total here

Total paid on amounts listed on line 11 this taxable year

January | February | March |

April May June

July

August

September

October | November | December

‘400.00 | 400.00

400-00 | 400.00 | 400.00 |

400.00 | 40(

‘400.00 | 400.00 | 400.

Allowable deduction this taxable year. Enter here and include on line 31 of Schedule A, Form 1040, the lesser of line 12 or line 13 ~



A. Who May Claim This Deduction.—
If you maintain a household which in-
cludes as a member one or more quali-
fying individuals, you may be allowed a
deduction for employment-related ex-
penses PAID during the taxable year.

You will be treated as maintaining a
household for any year only if you fur-
nish over half the cost of maintaining the
household for such year. If you are mar-
ried for a year, you and your wife (hus-
band) must provide over half of the
maintenance cost for such year.

The expenses of maintaining a house:
hold include property taxes, mortgage
interest, rent, utility charges, upkeep and
repairs, property insurance, and food
consumed on the premises. Such ex-
penses do not include the cost of cloth-
ing, education, medical treatment, vaca-
tions, life insurance, and transportation.

B. Qualifying Individual.—The term
“qualifying individual" means:

(1) A child who is under the age of 15
and with respect to whom you are
entitled to a deduction for an
exemption.

(2) A dependent 15 years of age or
over (a person who except for
the fact that she (he) had more
than $750 adjusted gross income
would be eligible to be claimed by
you as an exemption) of yours
who is physically or mentally in-
capable of caring for herself (him-
self), or

(3) Your wife (husband), if she (he)
is physically or mentally incapable
of caring for herself (himself).

Whether a person is a qualifying indi-
vidual will be determined on a daily
basis. For example, if your dependent
or wife (husband) for whom employ-
ment-related expenses were incurred
ceases to be a qualifying individual on
September 16, the dependent or wife
(husband) will be treated as a qualifying
individual through September 15 only.

C. Employment-related _ Expenses.—
The term “employment-related — ex-
penses” means amounts paid for the
following expenses, but only if such ex-
penses are incurred to enable you to be
gainfully employed:

(1) Expenses for household services,
and
(2) Expenses for the care of a quali-
fying individual.

Amounts paid to an individual who is
employed by you predominantly as a
gardener, bartender, or chauffeur do not
Constitute employment-related expenses.

Instructions

D. Limitation on Amounts Deduct-
ible.—A deduction not in excess of $400
shall be allowed for employment-related
expense INCURRED during any month. In-
curred means owed for payment, whether
or not paid. However, the expenses to be
deductible must be paid during your tax-
able year and must be within the limita-
tions. The expenses must be for services
in your household. Exception—Employ-
ment-related expenses which are incurred
for services outside your household shall
be taken into account if incurred for the
care of a child under the age of 15 for
whom you are entitled to claim an exemp-
tion, but only if such expenses incurred
during any month do not exceed:

(1) $200, in the case of one such
individual,

(2) $300, in the case of two such
individuals, and

(3) $400, in the case of three or more
such individuals.

E. Reduction for Certain Payments.—
If employment-related expenses were in-
curred during the taxable year solely for
a physically or mentally incapable de-
pendent 15 years of age or over or wife
(husband), the amount of such expenses
shall be reduced as follows:

(1) Physically or mentally incapable
dependent 15 years of age or
over by her (his) adjusted gross
income and disability payments
received during the taxable year
which exceed $750.

Physically or mentally incapable
wife (husband) by her (his) dis-
ability payments received during
the taxable year.

The term “disability payment” means
a payment (other than a gift) which is
made on account of the physical or
mental condition of an individual and
which is not included in gross income.

Examples—A taxpayer has a child,
age 6, and his wife is physically incapa-
ble of caring for herself. He incurs employ-
ment-related expenses of $500 solely
attributable to the care of the child, of
$1,000 solely attributable to the care of
his wife, and of $1,500 for household
services attributable to both the child
and wife. Of the taxpayer’s total em-
ployment-related expenses of $3,000 only
the $1,000 solely attributable to his
wife must be reduced as provided in
E(2).

A taxpayer has a dependent, age 15,
and a wife both of whom are physically
incapable of caring for themselves. He
incurs employment-related expenses of
$500 solely attributable to the care of the

{YeU.S. GOVERNMENT PRINTING OFFICE :1912-—O-458-127

(2.

dependent, of $1,000 solely attributable
to the care of his wife, and of $1,500 for
household services equally attributable
to both the dependent and wife. The
$1,500 of household expenses must be
allocated one-half to the dependent and
one-half to the wife. Accordingly, employ-
ment-related expenses of $1,250 are
attributable to the dependent, and em-
ployment-related expenses of $1,750 are
attributable to the wife. The expenses
attributable to each must be reduced as
provided in E(1) and E(2).

F. Income Limitation.—lf your ad-
justed gross income exceeds $18,000 for
the taxable year during which the ex-
penses are incurred, the amount of the
employment-related expenses incurred
during any month of the taxable year
shall be reduced by one-half the excess
of the adjusted gross income over
$18,000 properly allocated to such
month. If you are married during any
period of the taxable year, there shall be
taken into account the combined ad-
justed gross income of you and your wife
(husband) for such period.

G. Special Rules.—

(1) Married couples must file joint re-
turns.—lIf you are married at the end of
the taxable year, the deduction for em-
ployment-related expenses shall be al-
lowed only if you and your wife (husband)
file a joint return for the taxable year.

(2) Gainful employment __require-
ment.—If you are married for any period
during the taxable year, there shall be
taken into account’ employment-related
expenses incurred during any month of
such period only if:

(a) Both you and your wife (husband)
are gainfully employed on a sub-
stantially (three-quarters or more
of the normal or customary work
week or the equivalent during the
month) full-time basis, or actually
seeking gainful employment, or

(b) Your wife (husband) is physically
or mentally incapable of caring for
herself (himself).
Self-employment is considered
gainful employment for purpose of
this deduction.

(3) Payments to related individuals.—
No deduction shall be allowed for em-
ployment-related expenses paid to an
individual related to you or your wife
(husband).

H. Short-year filers.—If your return
covers a period of less than 12 months,
consult an Internal Revenue office for in-
formation concerning computation of
limitations.

Et, 25-1116272