My father-in-law lives with us.
He is over 65, has green card, stays with us taking care of our little baby. We provide all of his living support.
However, he has his own income, mostly are pensions and bank interest, which is just over the dependent limits.
My question is: can we take advantage of child care expenses? Can we say that we give him the $3000 for his work? And how can my father-in-law put this income in his tax return? Since we are not employer, we can't provide him w-2 form, and how does he pay social security tax and all others?
Thanks,