How Child Care Tax Credits Work?
Below is how child care tax credits work. In order to claim the child care tax credits, you must satisfy ALL of the following requirements. When all the eligibility requirements below are met, you are eligible to claim the child and dependent care expense tax credits.
1) The care if for one or more qualifying persons
A qualifying person for the child and dependent care tax credit is:
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a child who was under age 13 (age 12 or younger) when the care was provided and for whom you can claim as a dependent.
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your spouse who was physically or mentally incapable of self care and lived with you for more than half the year, or
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your dependent who was physically or mentally incapable of self care and for whom you can claim a dependent exemption (or could claim an exemption except the person had a gross income of $3,400 or more or filed a joint return) or
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any disabled person not able to care for him or herself whom you could claim as a dependent except that you could be claimed as a dependent on someone else's return in that tax year.
Are you a divorced or separated custodial parent?
If you are divorced or separated and are the custodial parent (during the year, the child lived with you longer than the child lived with the other parent), you can treat the child as a qualifying chid even if you cannot claim the dependent exemption for the child. (You must have signed Form 8332 or a statement agreeing not to claim the child's exemption.)
Are you a divorced or separated noncustodial parent?
If you are the noncustodial parent, you cannot treat the child as a qualifying person even if you can claim the child's exemption.
2) You (and your spouse) keep up a home you live in with the qualifying person
Keeping up a home means paying over half the cost of mortgage interest or rent, utility charges, repairs, food eaten at home, and other costs of running the home.
The home must be your main home and the main home of the qualifying person. Your home can be the qualifying person's main home even if he or she does not live there all year because of temporary absence due to school, a custody agreement, sickness, business, or vacation.
If the person was born or died during the year, your home is considered his or her main home for the year.
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