How Much Child Care Credits Will I Receive?

You figure the child care tax credits based on your work related expenses. How much child care credits you receive depends on your eligible work related expenses and your adjusted gross income. See Child Care Credit Amount.

What are work related expenses?

Work related expenses for the child care credits must be for the care of the qualifying person while you work or look for work.

What expenses are includable in claiming the child care tax credits?

Expenses are for the care of the qualifying person only if their main purpose is the person's well being and protection.

What expenses are not includable in claiming the child care tax credits?

Expenses for care generally do not include costs for:

• food
• clothing
• entertainment
• education

If your child is in a grade below kindergarten, the total cost of sending the child to school can be counted as a care expense is the amount paid for food and schooling is small and cannot be separated from the total cost of care.

Limits on work related expenses

The amount of work related expenses eligible for the credit is limited to the lowest of the following:

1. your actual expenses for the care

2. your earned income. If you are married your care expenses cannot exceed the income of he lower paid spouse. Income for the nonworking spouse who is a full time student or is incapable of self care is considered to be at least $250 (per month for each month he or she is a full time student) with one qualifying person ($500 with two or more qualifying persons) for each month the spouse is a student or is disabled.

3. a dollar limit of $3,000 for one qualifying person or $6,000 for two or more qualifying persons. This amount is reduced by any employer paid dependent care benefits that are excluded from your inocme. The amount of dependent care benefits is shown in box 10 of your W-2 form. (This amount directly reduces the dollar limit of $3,000 or $6,000)