Child And Dependent Care Credit

Question 1

What is the child and dependent care credit?

Answer 1

It is a credit for a percentage of their dependent care expenses.

Question 2

Is the child and dependent care credit refundable or nonrefundable?

Answer 2

It is a non-refundable credit

Question 3

What is the maximum amount of expenses that can be credited?

Answer 3

$3000 for one qualifying individual;
$6000 for two or more qualifying individuals

Question 4

What is the credit percentage range?

Answer 4

20% to 35%; AGI 15,000 and under is 35%; AGI $43,000 and over the credit is 20%

Question 5

What type of income must the taxpayer have to qualify for the credit? (Eligibility test)

Answer 5

Taxpayer must have earned income

Question 6

What type of expenses qualify for the credit? (Eligibility test)

Answer 6

Expenses incurred while the taxpayer is working or looking for work.

Question 7

What type of expenses do not qualify?

Answer 7

Expenses paid to the taxpayer’s spouse, a person who the taxpayer can claim as a dependent, or the taxpayer’s child under 19.

Question 8

What form is used to identify the caretaker provider?

Answer 8

Form 2441 and is required to claim the credit

Question 9

What makes for a qualifying individual?

Answer 9

1. The taxpayer’s qualifying child under the age of thirteen
2. The taxpayer’s dependent, who is physically romantically incapable of caring for themselves and live with the taxpayer for over half the year.
3. The taxpayer spouse who is physically romantically incapable of caring for themselves and lives with the taxpayer for over half the tax year