EDUCATION & ENRICHMENT

7 kids in a row

What Every Parent Should Know about the Child Care Tax Credit

We all want the very best for our children. That is why we enroll them into high quality Fremont preschool and daycare programs at a young age. A child’s brain is developing quickly, so it is important for their future to get them a good education, but unfortunately, quality education can be pricey. Luckily, you can cash in on some savings with the Internal Revenue Service’s Child and Dependent Care Credit. This tax credit can be a bit confusing, which is why we have come up with the following list of what every parent should know about the Child and Dependent Care Credit:

  • How to qualify -In general, if your children are over the age of twelve, you won’t quality for the tax credit, although exceptions can apply. The child care you receive must be directly connected to your ability to work. The person who received the care must have lived with you for more than half of the year. Your filing status must be one of the following: married and filing jointly, single, qualifying widow(er) with dependent child or head of household.
  • What documentation you need – You will need to complete an IRS Form 2441 in order to take advantage of this tax credit. This form will require you to fill out your name, address and either your Employer Identification Number or your Social Security number.
  • How much you can get – If you have one qualifying child, you could get up to $3,000 in tax credit, and if you have two or more qualifying children, you could get up to $6,000.