SALEM, Ore. - When taxpayers start filing their personal income tax returns in January, they may find that they're eligible for the new Working Family Household and Dependent Care Credit.
"This new credit is geared toward helping low- to moderate-income families pay for the care of their dependents while they're working or looking for work," said Megan Denison, Policy and Systems Unit manager at the Oregon Department of Revenue. The credit brings together benefits previously offered under Oregon's Working Family Child Care and Child and Dependent Care credits, and replaces both credits starting in tax year 2016.
To qualify for this new credit, the taxpayer must have earned income during the year, and their adjusted gross income (AGI) must be less than the limit for their household size. The taxpayer must also have qualifying household or dependent care expenses. Qualifying expenses are expenses paid for the care of a dependent child under age 13, a disabled spouse, or a disabled person who the taxpayer could claim as a dependent.
To help prevent tax credit fraud and ensure the credit is reaching its intended recipients, anyone who knowingly claims this credit falsely or assists someone else in doing so can be charged with a penalty of up to 25 percent of the credit amount claimed.
"This is important information for tax preparers," Denison said. "If you have clients claiming this credit, remember to review their supporting documentation to make sure they're eligible, so you don't end up being penalized. And as a courtesy to your client, please remind them of the potential penalty."
For more information on the WFHDC credit, including additional details on eligibility and supporting documentation requirements, visit www.oregon.gov/dor and look under "Popular Topics."
Visit www.oregon.gov/dor to get tax forms, check the status of your refund, or make tax payments; or call 1 (800) 356-4222 toll-free from an Oregon prefix (English or Spanish); (503) 378-4988 in Salem and outside Oregon; or email email@example.com. For TTY (hearing or speech impaired), call 1 (800) 886-7204.