For preparers who file returns claiming the Child and Dependent Care Credit, the Premium Tax Credit, or the Adoption Credit — the OBBBA-updated eligibility and phase-out rules, the reconciliation mechanics for advance PTC, and the substantiation each credit requires.
Three unrelated credits sit in the family-oriented section of the individual return, each with its own eligibility architecture and each affected by OBBBA changes. The Child and Dependent Care Credit under IRC §21 turns on qualifying expenses, qualifying individuals, and earned income of both spouses when a joint return is filed. The Premium Tax Credit under §36B runs on advance-payment reconciliation via Form 8962, with a household income determination and an applicable-percentage lookup that changes annually. The Adoption Credit under §23 covers qualified expenses within specific phase-out ranges and interacts with employer adoption benefits under §137. Each credit has substantiation requirements the preparer must have in the file at the time the return is signed.
This course covers each credit in operational detail. Coverage of the Child and Dependent Care Credit includes qualifying expenses and qualifying individuals, the earned income limitation for joint filers, and interaction with employer-provided dependent care assistance. Coverage of the Premium Tax Credit includes household income calculation, the applicable percentage table, Form 8962 advance-payment reconciliation mechanics, and the repayment limitation caps for taxpayers below certain income thresholds. Coverage of the Adoption Credit includes qualified adoption expense definition, special needs adoption rules, current phase-out ranges, and coordination with the §137 employer-provided adoption benefits exclusion.
The course closes with the reporting and substantiation requirements for each credit, and the documentation a preparer obtains from the client before the return is signed. Three hours of Federal Tax credit.
By the end of this course, participants will be able to:
Qualifying expenses and qualifying individuals, the earned income limitation for joint filers, the applicable percentage schedule, and interaction with employer-provided dependent care assistance.
Household income calculation for PTC purposes, the applicable percentage table, and the eligibility rules for coverage through the Marketplace.
Advance-payment reconciliation mechanics, the repayment limitation caps for taxpayers below certain income thresholds, and the reporting flow from Form 1095-A through Form 8962 to Form 1040.
Qualified adoption expense definition, timing rules for domestic and foreign adoptions, and the phase-out ranges under current law.
Special needs adoption rules and the deemed-expense provision, and coordination with the §137 employer-provided adoption benefits exclusion.
What each credit requires the preparer to obtain and retain from the client, including provider identification for §21, Form 1095-A for §36B, and adoption expense documentation for §23.
Jennifer Harris Smith, JD, CPA. Attorney (Texas). CPA (Texas). Member of Texas Bar College. Full bio →