The initial credit amount of the CTC is $2,000 for each qualifying child. The many changes to the child tax credit (CTC) implemented by ARP were not extended. 503.Ĭhild tax credit and additional child tax credit. For more information, see the Instructions for Form 2441 and Pub. The maximum credit amount allowed is 35% of your employment-related expenses. The dollar limit on qualifying expenses is $3,000 for one qualifying person and $6,000 for two or more qualifying persons. ![]() For 2022, the credit for the child and dependent care expenses is nonrefundable. The changes to the credit for child and dependent care expenses implemented by the American Rescue Plan Act of 2021 (ARP) were not extended. ![]() ![]() See Instructions for Form 1040.Ĭredit for child and dependent care expenses. Taxpayers who elect to use the lump-sum election method for their benefits will check this box. The credit for sick and family leave for certain self-employed individuals were not extended and you can no longer claim these credits. Wages earned while incarcerated are now reported on Schedule 1, line 8u.Ĭredits for sick and family leave for certain self-employed individuals are not available. Pension or annuity from a nonqualified deferred compensation plan or a nongovernmental section 457 plan are now reported on Schedule 1, line 8t. One simple and relatively claim substantiation method is by use of a diary record of trips and their purpose, with a tax claim calculated as a per kilometre rate using the Tax Office set rates.Īt the other end of the scale, larger claims for travelling expenses in connection with a rental property which is in an interstate location for example, or even overseas, are more likely to attract the attention of Tax Office auditors, who will want to see written evidence not only of the actual costs, but evidence which excludes the possibility that the expenses are private, or only incidentally associated with the rental activity.Scholarships and fellowship grants are now reported on Schedule 1, line 8r. Subject to that important exclusion, and according to the circumstances, a travelling claim can therefore include a claim for motor vehicle expenses, or if the property is far away, air fares, accommodation and meals can be substantiated and claimed as travelling expenses.įor evidence of deductible costs, choose one of the alternative car expense substantiation methods applicable to car expenses, or otherwise written evidence in the form of receipts and a travel diary would be necessary. Journeys which have a mainly private purpose are not claimable. This generally means that expenses of pre-purchase property inspections, or travelling during a pre-rental renovation period are not claimable as rental deductions.Īny expenses claimed must be mainly associated with the rental activity and not incidental to it. The property must be rented, or genuinely available for rental. The following reflects the position until 30 June 2017: Rental property travel expenses also cannot form part of the cost base of the property for CGT purposes.ĭetailed guidance on the operation of the new rules can be found in Law Companion Ruling LCR 2018/7, including important definitions for “residential premises” and “carrying on a business” and how to treat expenses which have multiple purposes. If you are an owner or part owner of a rental property, claims for expenses for travelling to the property to carry out maintenance or to inspect the property or for other reasons associated with the rental activity, such as collecting the rent, were deductible up until 30 June 2017.Īs foreshadowed in the 2017 budget, the Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 (now law) provides that from 1 July 2017 travel expenditure incurred in earning income from residential premises is not deductible.
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