What is the Dependent Care Tax Credit?

When you are a working taxpayer and have dependents that require care while you are working, you can take a tax credit called the Child and Dependent Care Tax Credit, to help offset the expenses. The dependent can be a child under the age of 13 or a spouse that requires care due to physical or mental limitations.

You can also claim the tax credit when you are looking for work. This is considered the same as working for this tax credit. Full time students are considered to have earned income while they are away from the home to qualify for the tax credit.

You have to name the care provider on your tax return and it cannot be a spouse, dependent, or someone under age. And you must fulfill the residence test where the child or dependent spouse must have lived in the house for more than half the tax year.

You can claim $3,000 for one dependent or $6,000 for two dependents. See IRS Publication 503 for more information on completing Form 2441 and claiming this credit when you prepare your taxes this year.

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