Reference no: EM132669618

Problem - Paul and Karen Kent are married, and both are employed (Paul earned $44,000 and Karen earned $9,000 this year). Paul and Karen have two dependent children, Samuel and Joy, both under the age of 13. Paul and Karen pay $3,800 ($1,900 for each child) to Sunnyside Day Care Center (422 Sycamore Road, Ft. Worth, TX 76028; Employer Identification Number 11-2345678), to care for their children while they are working.

a. Assuming that Paul and Karen file a joint return, what, if any, is their tax credit for child and dependent care expenses?

b. Complete Form 2441 for Paul and Karen; their AGI is $53,750, and their tax liability before any available child care credit is $2,825. Relevant Social Security numbers are: Paul (123-45-6789); Sam (123-45-6788); Joy (123-45-6787). Neither Paul nor Karen received any child care benefits from their employers.