Did you know that you can get part of your child care expenses reimbursed with the Child and Dependent Care Tax Credit?
This tax credit will help you pay for care for your dependents while you
The dependent care credit can be taken for:
The dependent care tax credit is calculated by a certain percentage depending on your taxable income. It can be 35% but it will become lower as your income rises.
The base amount that is used to calculate the credit is the lower one of:
For every month that one spouse was a full-time student or disabled the earned income is considered to be $250 for that month (if you paid for two or more children it will be $500- per month.)
See our Child Care Tax Credit Calculator to help you figure out what your credit amount will be.
Please note: It is a non-refundable credit meaning that it is limited to the amount of tax owed.
You can include expenses that were paid to an individual or organization. You must provide a tax ID of the care provider unless it is a tax-exempt organization.
Here is a list of individuals who cannot be the care provider:
To qualify for the Child and Dependent Care Tax Credit the expense must be primarily for the care of the qualifying person.
You cannot include amounts paid for food, lodging, clothing, education, and entertainment, unless it is a small amount and you cannot separate them from the qualifying care.
Can you include the amount paid for school since the school provides care while you work?
Depends on the age and grade of the child.
For children age kindergarten and above schooling is considered mainly education so you cannot include it as qualifying care. But for younger children in preschool or nursery school, it is considered childcare.
Day camp or summer school is a qualifying expense since it is not considered primarily education. Overnight camp however does not qualify.
Here are a few more things that can be included:
Here is a calculator that will help you estimate the amount of child care tax credit you will get. We have a separate table for married filing jointly and one for single and other filing statuses.
See the following sources:
Updated November 20, 2012
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How much will you get for the Child and Dependent Care Credit?
Check out this new calculator, to see how much your credit will be.
For more information or to see if you are eligible see the Child and Dependent Care Credit page.
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