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FAQ – Am I Eligible for the Child or Dependent Care Deduction

Pittsburgh Tax Service - Child Care CreditThe child and dependent care deduction / tax credit is specifically for working people, whether you are working from home or at an office. If you pay for childcare, whether at a home day care, preschool center, or summer camp, you can deduct up to $3,000 for one person or $6,000 for 2 or more people.

Care you can claim

To qualify for the child and dependent care credit, you must have paid someone to care for one or more of the following people:
• A child age 12 or younger at the end of the year whom you claim as a dependent on your tax return
• Your spouse, if that person is unable to take care of himself or herself and has lived in your home for at least half the year
• Any other person claimed as a dependent on your return, if that person can’t take care of himself or herself and has lived in your home at least half the year

Limits on who can provide care

You can claim the credit for money you paid for care as long as the recipient was not one of the following people:
• Your spouse
• A parent of the child being cared for
• Anyone listed as a dependent on your tax return
• Your own child age 18 or younger, regardless of whether he or she is a dependent on your tax return

Other requirements

There are several other tests you must meet to claim the credit:
• You (and your spouse, if you’re married) must have “earned income,” meaning money earned from a job. Non-work income, such as investment profits, doesn’t count.
• You must have paid for the care so that you could work or look for work. Being a full-time student or a parent being unable to care for them self does count as “working” for the purposes of the credit even if you don’t receive any income for it.
• If you are married, you must file a joint tax return.
• You must provide the name, address and Taxpayer Identification Number (TIN) of the person who provided the care. The taxpayer ID number is either a Social Security number (SSN) or an Employer Identification Number (EIN). Ask your care provider for the number.