Summary

The credit for child and dependent care expenses is a nonrefundable credit that allows taxpayers to reduce their tax liability by a percentage of their child and dependent care expenses.

The maximum expense amounts are $3,000 for one qualifying person and $6,000 for two or more qualifying persons.

The maximum credit rate is 35% of the taxpayer's expenses. A taxpayer must satisfy the five eligibility tests to qualify for the credit. The tests are the:

• Qualifying person test
• Earned income test
• Work-related expense test
• Joint return test
• Provider identification test

The credit is calculated and reported on Form 2441.