The Credit for Child and Dependent Care Expenses reported on Form 2441, is available to taxpayers who paid someone to look after their child or other "qualifying person" while they worked or looked for work. For a married couple filing jointly, they both must have earned income to take the credit and/or exclude dependent benefits from income unless one of them is disabled or is a student.
In this context, the taxpayer or spouse is considered a student if they were enrolled full-time at a school for some part of each of 5 calendar months during the tax year. (For the purpose of the credit, correspondence schools, internet-only schools, and on-the-job training don't count as schools.) They are considered disabled if they aren't able to physically or mentally care for themselves.
The amount of the credit is subject to several limitations, two of which are the taxpayer's and spouse's earned income. For the purpose of the credit, for each month the taxpayer or spouse was a student or disabled they are treated as having earned income of at least $250 (or $500 if they had two or more qualifying persons at any time during the year). If they worked while a student or disabled, their earned income for the month is the higher of their actual earned income or $250 (or $500). If both the taxpayer and spouse were either disabled or a student in the same month, for the purpose of calculating the credit only one of them is treated as having earned income during that month.
To enter Child and Dependent Care Expenses in TaxSlayer ProWeb, from the Federal Section of the tax return (Form 1040) select:
- Deductions
- Credits Menu
- Child and Dependent Care Credit - Complete Care Provider Information, then click Continue
- Complete Recipient(s) of Care Information
- Select the Dependents receiving care
- Enter Amount Paid, then click Continue to finish.
Note: This article provides guidance on completing Form 2441 in TaxSlayer ProWeb. It is not intended as tax advice.
Additional Information:
2021 Changes to the Child and Dependent Care Credit - Form 2441