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Since I previously was not getting any bonuses from my DC parents, I never had this issue. This Christams I got bonuses totaling over $300! (I have great families!!!) Do I claim this or not?
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You do not need to claim gifts. You got this at christmas, so it's a gift.
Recipient doesn't report income
Gifts you receive aren't considered income. It doesn't matter how large they are. You don't report them on your income tax return in any way.
There are a couple of important qualifications on this simple rule:
True gifts. This rule applies only to true gifts. You can't avoid paying income tax by calling something a gift when it isn't. For example, a "gift" you receive in exchange for services or some other consideration isn't a gift.
Income after gift. If you receive a gift of property that produces income, you must report any income produced after the gift. For example, if you receive stock as a gift, you must report any dividends paid on that stock after the gift.Comment
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I just went to a meeting that Tom did and he said you are suppose to claim it as income, same with gift cards.Comment
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"Any cash or gift cards from day care parents, even if they call it a "gift," is reportable income. This includes holiday cash or gift cards. This is because you are receiving this as a result of your business relationship."(from Tom's site)Comment
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I know we are supposed to...but do we? Really?
If I claimed a gift card or cash as income, I would be sure to buy something with it that was 100% write off for daycare so it would be a wash. But that's just me...Comment
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If we didn't claim it, we couldn't really tell you..... I concur with the others, tho, but I'm glad you asked this question! It cements the answer for me!
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I have always claimed cash bonuses because my husbands employer's have always included his on his W2, so have always figured it is what you are supposed to do.Comment
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