Rev. date: 07/2006
If you paid someone to care for a qualifying individual so you (and your spouse if you are married) could work or look for work, you may be able to claim the credit for child and dependent care expenses. If you are married, both you and your spouse must have earned income, unless one spouse was either a full–time student or was physically or mentally incapable of self–care. A person is physically or mentally incapable of self-care if, as a result of physical or mental defect, the person is incapable of caring for the individual's hygiene or nutritional needs, or requires full-time attention of another person for the individual's own safety or the safety of others. The expenses you paid must have been for the care of one or more of the following qualifying individuals:
- Your dependent (under the rules for qualifying child) who was under age 13 when care was provided. For divorced or separated custodial parents, refer to Child of Divorced or Separated Parents in Publication 503 , Child and Dependent Care Expenses. A noncustodial parent, however, cannot treat a child as a qualifying person even if the parent may claim the child as an exemption.
- Your spouse who was mentally or physically not able to care for himself or herself and who has the same principal place of abode as you for more than one-half of the year, or
- Your dependent (or an individual who would have been your dependent except that the individual's gross income is equal to or greater than $3,500 (for taxable years beginning in 2008), the individual filed a joint return, or the individual is a dependent of another taxpayer) who was physically or mentally not able to care for himself or herself, for whom you can claim an exemption, and who has the same principal place of abode as you for more than one-half of the year.
If a person qualifies as a qualifying individual for only a portion of the taxable year, then only those expenses incurred when the individual is a qualifying individual are included in calculating the credit. For more information on who qualifies as a dependent or qualifying child, refer to Publication 501
, Exemptions, Standard Deduction, and Filing Information
In addition to the conditions just described, to take the credit, you must meet all the following conditions:
- You must provide the taxpayer identification number (usually the social security number) of the qualifying person.
- You must file a joint return if you are married.
- The payment cannot be to someone you can claim as your dependent, or to your child who is under age 19 even if he or she is not your dependent. The payment can not be to your spouse or to the parent of your qualifying child who is your qualifying individual, and
- 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 tax exempt, you need only report the name and address on your return. You can use Form W-10, Dependent Care Provider's Identification and Certification, to request this information from the care provider. If you do not provide information regarding the care provider, you may still be eligible for the credit if it is shown that you exercised due diligence in attempting to provide the required information.
If you qualify for the credit, complete Form 1040-A (Schedule 2)
, or Form 2441
with Form 1040
. If you received dependent care benefits from your employer (this amount should be shown on your Form W-2
), you must complete Part III of Schedule 2 (Form 1040A) or Form 2441. You cannot use Form 1040EZ if you claim the child and dependent care credit.
The credit is a percentage, based upon your adjusted gross income, of the amount of work–related child and dependent care expenses you paid to a care provider. There is a maximum dollar limit of dependent care expenses you can use for this credit. The amount of the maximum dollar limit depends on the taxable year and the number of qualifying individuals. These dollar limits must be reduced by the amount of any dependent care benefits provided by your employer that you exclude from your income. Refer to Publication 503
, Child and Dependent Care Expenses
, for additional information.
If you pay someone to look after 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 tax and pay federal unemployment tax. For information, refer to Publication 926
, Household Employer's Tax Guide
, or to Tax Topic 756