Child and Dependent Care Credit
Overview
(Does Not Apply To 2021)
Maximum Expense Limit - $3,000 for one and $6,000 for two or more qualifiers.
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Earned Income Limit – Expenses limited to earned income.
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Disabled or Full Time Student Monthly Imputed Income - $250 for one; $500 for two or more qualifiers.
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AGI Limitation – 35% to 20% credit(see table)
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AGI over $43,000 – credit percentage equals 20%
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Employer dependent care plans – reduces qualified expenses
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Married taxpayers must file jointly
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Qualifier
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Child under 13 (i.e., take credit for expenses up to date child turns 13);
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A spouse or person - physically or mentally disabled lived with the taxpayer more than half the year (see details for more qualification rules).
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Non-refundable, No carryover
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School Expenses – under kindergarten
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Day camps – generally ok
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Absences or part time employment – prorate expenses.
Related IRC and IRS Publications and Forms
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Pub 503 – Child and Dependent Care Expenses
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Form 2441 - Child and Dependent Care Expenses
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Form W-10 – Dependent Care Provider’s ID and Certification
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IRC Sec 21 - Expenses for Household and Dependent Care Services Necessary for Gainful Employment
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IRC Sec 129 – Dependent Care Assistance Programs