Kids' enrichment activities run the gamut from music, dance and theater classes to art and cooking instruction. While the cost of kids' enrichment activities are not typically considered tax-deductible expenses, there are several exceptions to this rule. Parents applying for these types of deductions should save all receipts and paperwork from programs, as well as collect detailed descriptions of the organizations conducting enrichment programs. This information will be beneficial when it comes to filing taxes.
According to the Internal Revenue Service, costs associated with educational enrichment programs are not tax-deductible unless several criteria are met. The children participating in the programs must be under the age of 13; the children must be enrolled in the program during hours when the custodial parent is looking for work or is working; and the facility conducting the enrichment program must be a licensed and accredited educational facility.
Nonprofit Enrichment Programs
Youth enrichment programs that are conducted by a nonprofit organization may be tax-deductible if payment is made to the nonprofit organization itself and not to an individual in the organization. For example, under normal circumstances, a ballet class offered at a dance studio would not be considered a tax-deductible expense; however, a ballet class offered by a nonprofit theater company may be considered deductible if the payment is made to the nonprofit in the form of a gift. In this manner, the cost of the enrichment activity is deductible if it is classified as a donation to a nonprofit organization.
Religion-Based Enrichment Programs
Much like nonprofit-based enrichment programs, church-based youth enrichment programs may also be considered tax-deductible if payment is made in the form of a church contribution. Examples include youth groups, mission trips, music and choral groups and camps.
To be eligible for allowable deductions related to kids' enrichment activities through a nonprofit organization, a parent must ensure the organization meets the criteria outlined by the IRS. This typically means an organization must have 501(c)(3) status. In deducting enrichment activities related to a religious organization, receipts must be maintained and the organization must be a recognized and accredited religious organization. To deduct the cost of educational enrichment activities incurred during the course of a parent’s work hours, a parent must follow the same criteria outlined for the deduction of child-care-related expenses. Deduction percentages are linked to a parent’s salary and the program must be conducted as part of a child-care or day care program.