Do you have a flexible saving account for dependant care? Child & Dependent Care Credit - Limit with ER Benefits Although there are expenses in excess of the $5,000 of dependent care benefits, there is no credit when the dependent care benefit exceeds $3,000. The reason for this is that the maximum allowable expenses that can be used for the credit is $3,000. You have actually received a tax benefit for a total of $5,000 in expenses by using the dependent care benefit. Therefore, there is no expense that remains allowable for the credit. The amount of the dependent care benefit disqualifies you from the child tax credit. Lines 28 - 32 of the Form 2441 will show this. If you have, for example, a dependent care benefit amount of $2,000 with the $7,169 of expenses, only $1,000 would be allowed for the calculation of the credit. The IRS does not allow the maximum dependent care benefit of $5,000 plus an addition of the maximum credit amount of $3,000 for the child. The dollars used for the benefit and the credit are overlapping. Generally speaking, depending on the level of your income, the $5,000 in dependent care benefit is a better deal for an individual than the credit.

No...it is not an "advance" on our next year's refund (if you even get a refund - many people don't), instead, it is pre-payment of a tax credit that is being applied to Y2008 taxes. Yes, for accounting purposes, this pre-payment will be listed as a tax credit on Y2008 tax form. Do not confuse a tax credit with a tax refund. A tax refund is when you have pre-paid more money for your tax bill (through estimated payments or payroll witholding), than you owe..that money is a refund. A tax credit is an amount that is subtracted from the taxes that you owe. The net result is that you will get the tax credit this year, instead of next. I hope this clears up the misunderstanding in this post.

I worked for the Social Security Administration for over 30 years. Social Security does a hell of a lot of good. I know personally because Medicare pays for my kidney dialysis. If anyone is worried about waste and fraud, you can report it by calling 1 800 772 1213 or going online on www SSA gov and look for the "report fraud" button, leading to the Office of the Inspector General. Examples of fraud would be someone buying or selling Social Security cards, working while disabled (a guy who collects Disability who can cut his lawn and play golf doesn't count), not reporting a death and cashing that person's Social Security checks afterwards, and receiving mothers/father checks for a child under 18 who doesn't have custody are examples. And don't blame Seniors or Social Security employees for the cheaters.

Julie. This is hard to explain and probably hard to understand at least for those who know my struggles. I've ask the state for some help. Medical for myself (rest of family has it) I've ask for some help twice to help provide something for Christmas for my two young kids still counting on Santa, I've ask for help with groceries a couple of times, I've ask for help to replace a broken furnace. .. I was denied every single time. Now although I would put my feelings aside and ask for help when needed I just can not accept money because I take care of my sick daughter. I chose this girl. I was there when she was born. I knew from the second she entered the world she was going to have a life of struggles and I knew I would also...but I chose to be her mother regardless. Absolutly the money would ease burdens, but it would also cause another sort of moral burden that I couldn't accept emotionally. I do accept help with home care nurses when needed. Once both my boys were admitted to hospital together so I had to have someone at the house with Amiee. A few times while on IV antibiotic therapy a nurse had to come. A few times I was unwell and someone came to help Amiee. I was grateful and happily accepted the help. I just can not make myself take money to care for her myself. For anyone that is ready to jump on me about this. This is not up for debate. I will not explain myself anymore than I have above. You don't have to agree with me but just for a second put yourself in my place.