Deductions & credits
Okay, if box 10 has $357 that is not the balance remaining on December 31.
You have two children, so you have up to $6000 of qualified expenses to use toward the Child and Dependent Care Credit. You had less than $6000, so you are good.
When you enter your daycare expense of $4953, this is what will happen-
- The $357 of Dependent Care Benefit, will be reconciled.
- TurboTax will compute that you have $4596 of expenses to use for the Child and Dependent Care Credit
Then based on your total income, you will get a percentage of the qualified expenses for your credit. It will be anywhere from 20% to 35%.
This credit can only be used to reduce your tax liability.
