Frank Settimo was the single owner of his S corporation. His wife and about 24 other people worked for the corporation.

The corporation employed Frank’s wife, Sallyn. Because they had four children between the ages of 2 and 10, the corporation paid for child care for the children so Sallyn could work.

The IRS contested the child care deduction.

Settimo asserted that the corporation should get the deduction under revenue ruling 73-348. That ruling allowed a deduction because child care enabled ... Log in to view full article.