Foster Child Tax questions (foster care, cost, children)
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We received a 2 day old foster child in March 2012 and my wife quit her full time job (works part time now) to help care for the child. It's been a financial hardship for us, but we love "our" new baby very much. Anyway I have questions about what kinds of federal tax deductions we can take to ease our burden a little.
I know I can claim the child on my tax return as a dependent, there's a 1 thousand dollar child credit and the money we receive from the state to care for the child is tax free. What I have questions about is Foster children charitable deductions.
My wife took a 6 week unpaid family leave of from her full time job when we first received the child. Could the money she would have made if she worked be considered a charitable donation? She returned to her full time job for a week and ended up quitting and working part time.
I would expect food and clothing to be considered part of the care we provide the child, but what about additional things we had to buy, baby furniture, car seats, strollers, toys, un-reimbursed medical expenses. etc, are these considered charitable deductions?
Could the money she would have made if she worked be considered a charitable donation?
No. Only money donated to a government recognized charity is a charitable donation.
Quote:
Originally Posted by TechGromit
... what about additional things we had to buy, baby furniture, car seats, strollers, toys, un-reimbursed medical expenses. etc, are these considered charitable deductions?
No, except for unre-imbursed medical expenses, but only the portion of your expenses that exceed the baseline set for medical expenses, and only if you do not take the standard deduction.
We received a 2 day old foster child in March 2012 and my wife quit her full time job (works part time now) to help care for the child. It's been a financial hardship for us, but we love "our" new baby very much. Anyway I have questions about what kinds of federal tax deductions we can take to ease our burden a little.
I know I can claim the child on my tax return as a dependent, there's a 1 thousand dollar child credit and the money we receive from the state to care for the child is tax free. What I have questions about is Foster children charitable deductions.
My wife took a 6 week unpaid family leave of from her full time job when we first received the child. Could the money she would have made if she worked be considered a charitable donation? She returned to her full time job for a week and ended up quitting and working part time.
I would expect food and clothing to be considered part of the care we provide the child, but what about additional things we had to buy, baby furniture, car seats, strollers, toys, un-reimbursed medical expenses. etc, are these considered charitable deductions?
You really should talk with a tax professional to make sure you have the most accurate information.
My wife took a 6 week unpaid family leave of from her full time job when we first received the child. Could the money she would have made if she worked be considered a charitable donation? She returned to her full time job for a week and ended up quitting and working part time.
No. It wouldn't be any different than the time spent volunteering for any other charity.
Quote:
I would expect food and clothing to be considered part of the care we provide the child, but what about additional things we had to buy, baby furniture, car seats, strollers, toys, un-reimbursed medical expenses. etc, are these considered charitable deductions?
That is what the money from the state is for. What sort of medical expenses do you have? Those should be covered by the state.
You should definitely talk to a professional to make sure everything is in order on your taxes, but I am pretty sure the unpaid leave would be considered part of FMLA. For FMLA you don't get a break on your taxes, you just have a guarantee that you will still have a job when you return to work after a break. If it is due to a temporary disability (like pregnancy) then you can sometimes get money for a period of time, but I doubt taking care of an infant would qualify.
No. Only money donated to a government recognized charity is a charitable donation.
That's not entirely correct. Certain services and donations of items for charitable purposes are also deductible. It doesn't only have to be money. For instance, I'm involved with animal rescue and do transports of cats and dogs from pounds to rescues or adoptive homes and I can deduct some of the cost of doing these transports as long as I do them for a 501c3 organization. When I fostered for a 501c3 I could deduct some of the money I spent on my foster animals as these are considered donations to the organization. I would think that if you foster children for a 501c3 or a government agency it would be the same. I really would check with a professional though so ensure you get accurate info. I highly doubt that you can deduct the lost wages but I could be wrong.
What sort of medical expenses do you have? Those should be covered by the state.
Yes the state covers all medical expenses, but my wife took the baby to urgent care when she had a cold. The place she took the baby to doesn't accept medicare, so my wife paid for the visit. Techincally I guess she could have went over to the hospital's emergancy room, but it was more convient for her just to stay at the place was was already at.
[quote=TechGromit;26975539Techincally I guess she could have went over to the hospital's emergancy room, but it was more convient for her just to stay at the place was was already at.[/quote]
Having adopted two kids through foster care, I can tell you that government bureaucracy and the phrase "more convenient" are mutually incompatible.
Good luck with the little one!
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