You may be able to claim the child and dependent care credit if you paid expenses for the care of a qualifying individual to enable you and your spouse filing a joint return to work or actively look for work. You may not take this credit if your filing status is married filing separately. The credit amount is a percentage of the amount of work-related expenses you paid to a care provider for the care of a qualifying individual. The percentage depends on your adjusted gross income.
The total expenses that you may use to calculate the credit should not be more than $3,000 (one qualifying individual) or $6,000 (two or more qualifying individuals). Expenses paid for the care of a qualifying individual are eligible expenses if the primary reason is to assure the individual's well-being and protection.
A qualifying individual for the child and dependent care credit is:
- Your dependent qualifying child who is under age 13 when the care is provided,
- Your spouse who is physically or mentally incapable of self-care and lived with you for more than half the year, or
- A person who is physically or mentally incapable of self-care, lived with you for more than half the year and either: (i) is your dependent; or (ii) could have been your dependent except that he or she is over the gross income limit or files a joint return, or you (or your spouse, if filing jointly) could have been claimed on another taxpayer’s 2014 return.
An individual is physically or mentally incapable of self-care if, as a result of a physical or mental defect, the individual is incapable of caring for his or her hygiene or nutritional needs, or requires the full-time attention of another person for the individual's own safety or the safety of others.
A noncustodial parent who is claiming a child as a dependent should review the rules in the topic Child of Divorced or Separated Parents or Parents Living Apart in Publication 503, Child and Dependent Care Expenses, as the rules for claiming dependency exemptions are different from the rules for a qualifying person for the child and dependent care credit. If a person is a qualifying individual for only a part of the tax year, only those expenses paid during that part of the year are included in calculating the credit. You must provide the taxpayer identification number (usually the Social Security number) of each qualifying individual.
The provided care may be in the household or outside the household; however, do not include any amounts that are not primarily for the well-being of the person. You should divide the expenses between amounts for care and the amounts that are not for care. You must reduce the remaining qualifying expenses by the amount of any dependent care benefits provided by your employer that you exclude from gross income. In general, you can exclude up to $5,000 for dependent care benefits received from your employer. Additionally, in general, the expenses claimed may not exceed the smaller of your earned income or your spouse’s earned income; however, a special rule applies if your spouse is a full-time student or incapable of self-care.
Care Providers - You must identify all persons or organizations that provide care for your child or dependent. You must report the name, address and taxpayer identification number (either the Social Security number or the employer identification number) of the care provider on your return. If the care provider is a tax-exempt organization, you need only report the name and address on your return. You can use Form W-10 (PDF), Dependent Care Provider's Identification and Certification, to request this information from the care provider. If you cannot provide information regarding the care provider, you may still be eligible for the credit if you can show that you exercised due diligence in attempting to provide the required information. If you pay a provider to care for your dependent or spouse in your home, you may be a household employer. If you are a household employer, you may have to withhold and pay Social Security and Medicare taxes and pay federal unemployment tax. For more information, refer to Publication 926, Household Employer's Tax Guide, or Topic 756.
The care provider cannot be your spouse, the parent of your qualifying individual, your child who is under the age of 19 or a dependent whose exemption you claim on your return.
If you qualify for the credit, complete Form 2441 (PDF), Child and Dependent Care Expenses, and Form 1040 (PDF) or Form 1040A (PDF). If you received dependent care benefits from your employer (amount is shown on your Form W-2 (PDF)), you must complete Part III of Form 2441. You cannot claim the child and dependent care credit if you use Form 1040EZ (PDF). For more information about qualifying for this credit, refer to Publication 503, Child and Dependent Care Expenses and to Can You Claim the Child and Dependent Care Credit? on IRS.gov.
Page Last Reviewed or Updated: January 16, 2015