Can Summer Camp Expenses Qualify for a Tax Deduction?

Tax Summer Series #2

Summer is here! Many families begin planning activities for their children, including enrolling them in summer camps. These programs offer childcare and enrichment, but can also provide tax benefits. For tax practitioners, this is an opportunity to educate clients about how certain summer camp expenses can qualify for the Child and Dependent Care Credit (CDCC).

Understanding The Child and Dependent Care Credit

The Child and Dependent Care Credit helps working parents offset the cost of care for children under age 13. To qualify, the care must enable the taxpayer (and their spouse, if filing jointly) to work or actively look for work. The credit can be between 20% and 35% of qualifying expenses, depending on the taxpayer’s income.

For 2025, the maximum amount of expenses that can be considered for the credit is:

• $ 3,000 for one qualifying child or dependent
• $ 6,000 for two or more qualifying dependents

To claim this credit, taxpayers will complete Form 2441, Child and Dependent Care Expenses, which includes the care provider’s name, address, and taxpayer identification number (TIN) or social security number (SSN).

Which Camps Qualify?

It is essential to know that not all summer camps qualify for the CDCC. The IRS does make a clear distinction:

• Day Camps: Expenses for day camps generally qualify as CDCC, as long as the primary purpose is to provide care while the parent works. This would include specialty camps (e.g., sports, science, or art) as long as they run during day hours.
• Overnight Camps: Expenses for overnight or sleepaway camps do not qualify, even if the camp allows the parent to work during the day.

This distinction is essential when advising clients, as they may assume all camp-related expenses are deductible.

Qualifying Documentation for Filing

To ensure eligibility and compliance, practitioners should recommend that clients track all payments they make to the camp provider. They should also obtain information about the camp, such as the TIN or an SSN. Taxpayers should keep receipts or statements showing the amount paid, the child’s name, and the dates of service. The CDCC does phase out once the child is over 13 unless the child is disabled. Another essential thing to remember is that these expenses must be work-related, meaning they were incurred so the taxpayer and spouse, if applicable, could work or look for work. If the taxpayer is a full-time student or incapable of self-care, they may qualify under special rules.

Practical Tips for Parents and Practitioners

• Employer-Provided Dependent Care Benefits: If a client receives dependent care assistance through their employer, such as a flexible spending account, they must subtract those amounts from the total qualifying expenses before calculating the CDCC.
• Earned Income Requirement: Both spouses must have earned income unless one is a full-time student or incapable of self-care. An important reminder is that the credit cannot exceed the earned income of the lower-earning spouse.
• Separated or Divorced Parents: Only the custodial parent who lived with the child for the greater part of the year may claim the credit. This is even if the noncustodial parent claims the child as a dependent.

Conclusion

Summer camps are lots of fun and provide an enriching experience for children, but they can be more than that—they can provide meaningful tax savings for working parents. As a tax practitioner, you play a key role in helping clients understand which expenses qualify, how to document them properly, and how to maximize their tax benefits.

You can ensure your clients take full advantage of the CDCC by being informed and proactive; it will ensure they are compliant with the IRS rules.

By Jill Kenady, Tax Materials Specialist
U of I Tax School

Sources

• Child and Dependent Care tax credit can help offset summer day camp expenses 
• Publication 503 (2024), Child and Dependent Care Expenses