New York Residents: Recordkeeping Tips to Ensure You Receive Valuable Tax Credits

The New York State Department of Taxation and Finance today reminded taxpayers to keep good records throughout the year to ease the process for claiming tax credits on their personal income tax returns. For example, taxpayers should save proof of childcare expenses this summer to support eligibility for the child and dependent care credit.

“Summer day-camp expenses for a child or dependent may qualify you for the Child and Dependent Care Credit,” said New York State Commissioner of Taxation and Finance Michael Schmidt. “This valuable credit, which varies based on income, can help reduce expenses involved in raising a child or caring for a dependent. I encourage all New Yorkers to check their eligibility and keep the required records to claim this credit.”

Keep good records

You must provide proof of how much money you spent on summer day-camp to support your claim for the tax credit. Examples: copies of cashed checks that were written to and cashed by the summer camp; or an itemized statement issued from the camp listing each payment received from you. See the two-page DTF-216, Claim for Child and Dependent Care Credit, for more information.

The Tax Department will not accept the following as proof: statement or document indicating that money was paid by someone else (such as a friend or relative) directly to the summer camp; handwritten receipts that weren’t issued at the time of payment and can’t be verified by the Tax Department; a statement, without any additional supporting documentation, that you made cash payments (or the camp received cash payments).

You don't need a scanner to make copies of your documentation. You can use your smartphone to take a digital picture.

Guidelines

If you qualify to claim the federal child and dependent care credit, you’re entitled to claim New York State's credit. The New York State credit ranges from 110% of the federal credit, for those with incomes under $25,000, to 20% if their income is over $150,000. A New York City Child Care Tax Credit is also available to New York City residents with income of $30,000 or less with a child or children under age 4.

Dependent-care benefits from an employer will reduce the credit amount; these benefits are included on the recipient’s Form W-2, Wage and Tax Statement.

Source: The New York State Department of Taxation and Finance