If the $5000 at work is a pre-tax account, as I suspect, then you have $5,000 eliminated. Look at your w2, box 10. Is the $5,000 there? You stated that you have $15,000 of expenses. The deduction is $3,000 per child. You should list $6,000 for your deduction.
This gives you $1,000 as an allowed expense for the credit to calculate.
See this example from Instructions for Form 2441: For example, if you have two qualifying children, one age 3 and one age 11, and you incur $6,000 of qualifying work-related expenses for the 3-year-old and no qualifying work-related expenses for the 11-year-old, you can use $6,000 to figure the credit. In this situation, you should list $6,000 for the 3-year-old child and -0- for the 11-year-old child. The $6,000 limit would be used to compute your credit unless you have already excluded or deducted, in Part III, certain dependent care benefits paid to you (or on your behalf) by your employer.
Since your numbers change when you remove it, you must be missing a step somewhere. Be sure you are looking at Form 2441 and not just the 1040. To print or view your forms:
- In desktop, switch to Forms Mode.
- For online:
- On the left side, select Tax Tools
- Select Print center
- Select Print, save or preview this year's return
- If you have not paid, select pay now.
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