You may be able to claim the child and dependent care credit if you pay for the care of a qualifying individual so you can work or look for work. If you are married, both spouses must have earned income to qualify for the credit. Exceptions apply to disabled or student spouses.
The amount of your credit is generally a percentage (20-35%, depending on adjusted gross income) of the work-related care expenses you paid to a care provider. The expenses that qualify for the credit must be reduced by the amount of any dependent care benefits provided by your employer that you excluded from gross income.
Your qualifying expenses are capped at $3,000 ($6,000 if you had two or more qualifying individuals). The credit is nonrefundable, so it can only reduce your tax liability to zero.
To enter child and dependent care information in your TaxAct return, go to our Form 2441 - Entering Child and Dependent Care Expenses in Program FAQ.
Per IRS Instructions for Form 2441:
A qualifying person is:
The maximum allowable credit is $1,050 for one dependent or $2,100 for two or more dependents (35% of $3,000/$6,000 in expenses). The allowable credit will decrease if you have fewer qualifying expenses or if you have an AGI over $15,000.
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