The Child and Dependent Care Credit helps parents and caregivers lower their federal tax bill when they pay for care so they can work or actively look for work.
If you qualify, this credit can reduce the amount of federal income tax you owe based on eligible care expenses you paid during the year.
How much is the Child and Dependent Care Credit?
For the 2025 tax year, the amount of care expenses you can use to calculate the credit is capped at:
$3,000 for one qualifying individual
$6,000 for two or more qualifying individuals
These limits are used to calculate the credit and don’t represent a guaranteed refund amount. The actual credit is a percentage of these expenses and depends on your adjusted gross income.
Who qualifies for the Child and Dependent Care Credit?
You may qualify if:
You paid for care so you (and your spouse, if filing jointly) could work or actively look for work
You had earned income during the year
The care was for a qualifying individual
A qualifying individual can be:
Your dependent child under age 13
Your spouse who is physically or mentally unable to care for themselves and lived with you for more than half the year
Another individual who is physically or mentally incapable of self-care, lived with you for more than half the year, and either:
Was your dependent, or
Would have been your dependent except that they had gross income of $5,200 or more, filed a joint return, or you (or your spouse, if filing jointly) could be claimed as a dependent on another taxpayer’s return
If an individual qualifies for only part of the year, only expenses paid during that qualifying period can be included.
Earned income limits
In general, the amount of care expenses you can use to calculate the credit can’t exceed your earned income, or your spouse’s earned income if you’re filing jointly (whichever is lower).
Special rules apply if you or your spouse is a full-time student or incapable of self-care.
What if I’m divorced, separated, or married filing separately?
In most cases, the custodial parent is the one who can treat a child as a qualifying individual for this credit, even if the noncustodial parent claims the child as a dependent.
Married filing separately generally disqualifies you from claiming the credit.
There’s a limited IRS exception for certain taxpayers who lived apart from their spouse and meet specific requirements.
What types of care expenses qualify?
You may be able to claim expenses paid for care provided:
In your home
In a caregiver’s home
At licensed childcare centers, nurseries, or day camps
For before- and after-school care
Tuition for kindergarten or higher grades doesn’t qualify. Only expenses primarily for the well-being and care of the individual count.
Who can’t I pay for care?
The following payments don’t qualify for the credit:
Payments to your spouse
Payments to the child’s parent
Payments to someone you can claim as a dependent
Payments to your child under age 19
Are there limits if my employer offers dependent care benefits?
Yes. If your employer provided dependent care benefits (reported in Box 10 of Form W-2), you can’t use those same expenses to claim the credit.
The same applies to expenses reimbursed through a dependent care flexible spending account (FSA).
Is the Child and Dependent Care Credit refundable?
No. This credit is nonrefundable. It can reduce your tax liability to zero, but it won’t generate a refund by itself.
How can I double-check my eligibility?
If you’re unsure whether you qualify, the IRS offers an interactive eligibility tool. You’ll enter details such as:
The age of the child or dependent
Your filing status
Your work and income situation
It’s a quick way to confirm whether you can claim the credit.
Key takeaway
The Child and Dependent Care Credit can help offset the cost of care that allows you to work or look for work. Eligibility depends on who received care, who provided it, your filing status, your earned income, and whether your employer offered dependent care benefits. Understanding these rules can help you claim the credit correctly and avoid issues later.
This content is provided for informational purposes only and should not be construed as tax, legal, financial, accounting, or other advice. Rules and regulations vary by location and are subject to change, so please consult with an expert if you need advice specific to you.
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