That's really helpful! I hadn't thought about breaking it down hourly like that. My daughter is there from 7:30am-5:30pm most days, with regular program hours being 9am-3pm, so that's 4 extra hours daily that are clearly for childcare purposes. Summer is about 8 weeks when she's there full-time. Does this sound like a reasonable approach?

That approach sounds perfect for your situation. With regular program hours of 9am-3pm and your daughter attending 7:30am-5:30pm, you've got 4 hours of extended care each day that clearly qualifies for the credit. For the summer period (8 weeks), you can count all hours as qualified childcare expenses since regular school wouldn't be in session. The IRS recognizes that summer programs serve a dual purpose of education and allowing parents to work, so the full cost during that period typically qualifies regardless of content.

Actually, the Child and Dependent Care Credit maximum was temporarily increased a couple years ago but has reverted back to the lower amounts for 2025 filing. Always check the current year's limits because Congress keeps changing these numbers.

Do you have a template for that written plan? Or did you have your accountant create it? I'm trying to figure out if this is something we can do ourselves or if we need professional help with it.

I created it myself based on some research, then had my accountant review it. It doesn't need to be super complex - mine is about 2 pages. It basically states that the corporation will reimburse employees (including shareholder-employees) for health insurance premiums up to a certain amount annually. Key elements to include: effective date, eligible employees, what expenses are covered, maximum reimbursement amounts, how/when reimbursements will be processed, and documentation requirements (employees need to submit proof of premium payments). You should also state that it's intended to comply with relevant tax regulations.

I did this with my S-corp and it works well, but make sure you understand the income reporting. The marketplace uses MAGI (modified adjusted gross income) to determine subsidies, which includes your W-2 wages plus business profits passed through to your personal return.

" GTLI is almost "certainly Group Term Life" Insurance - this is typically for employer-provided life insurance coverage exceeding $50,000. If the value of that coverage exceeds $50K, the IRS considers the premium for the excess amount as taxable income. "Selecting" Other probably worked fine because Box 14 items are mostly informational. However, you should check if there was also an amount in Box 12 with "code" C -'that s where the taxable portion of group term life insurance would be reported, and that DOES affect yourtaxes.

Thanks for explaining that! I didn't have anything in Box 12 with code C, so maybe it was just informational like you said. I'll double check this year's W-2 to see if anything shows up there. Really appreciate you clearing up what that abbreviation means - been bugging me for months!

Thank you so much for sharing your experience. That makes me feel a lot better. Did you use a tax preparer or did you do it yourself? And about how much were the penalties as a percentage of what you owed?

I used a local tax preparer who advertised help with unfiled returns. Cost me about $175 per year to prepare, but it was worth every penny for the peace of mind. The penalties ended up being roughly 25% of what I owed, plus interest that had accumulated. So for example, one year I owed about $2,200 in actual taxes, and the penalties/interest added about $800. Not fun to pay, but definitely not the financial apocalypse I had built up in my head. The payment plan let me spread it out over 36 months too.

Yes! This tripped me up too. If you're using software like TurboTax or H&R Block, make sure you buy the specific year versions for each past year. Current year software won't work for prior years.

That's a great suggestion! I'll definitely check with our HR department. Do you still use the consultation even for "simpler" tax years, or only when something significant changes?

I use it every year because equity compensation has different considerations annually. For example, last year I needed advice on whether to sell some RSUs immediately upon vesting or hold them (tax implications of each). This year I needed help with ESPP disqualifying dispositions. Even in "simple" years, I've found they catch optimization opportunities I would have missed. Last year they identified a way to time some charitable contributions that saved me about $800 in taxes. The free hour pays for itself many times over.

TurboTax Premier has been pretty reliable for me with RSUs and options. Not perfect, but it has specific interview questions for equity compensation. The key is making sure you have the right forms from your broker - specifically the 1099-B needs to show adjusted cost basis for RSUs.