What Is the Child and Dependent Care Credit?

The Child and Dependent Care Credit reimburses a percentage of the money you spend on care for a qualifying child under 13 (or a dependent of any age who is physically or mentally unable to care for themselves) so you can work or actively look for work. The credit covers up to $3,000 in expenses for one qualifying person or $6,000 for two or more, and the credit rate ranges from 20% to 35% depending on your adjusted gross income — lower-income families receive the higher rate. Unlike the Child Tax Credit, which is for simply having children, the dependent care credit is specifically for money you actually spend on childcare or care for a disabled dependent. If your employer offers a Dependent Care FSA, you can use that in combination with the credit, but only to the extent the credit covers expenses beyond what the FSA already covered (you can't double-count the same expenses). The credit applies to day care, after-school programs, summer day camps, babysitters, and similar care arrangements.