In order for you to be able to claim the Child and Dependent Care credit, you will need to enter her information as the care provider. She is supposed to report that income on her tax return. Her being on social security does not affect your entitlement to claim the credit.
The IRS Child and Dependent Care Expense Credit can reduce your
tax bill if you paid for a dependent's care so that you could work or go to
school full-time. There is no minimum amount you have to spend to qualify.
The credit is worth up to $3,000 per dependent – with a maximum
of $6,000 for two or more dependents – as long as you (and your
spouse, if you're filing jointly):
- Have
earned income; and
-
Paid
someone else to care for a child under age 13, disabled spouse, or dependent;
and
- Paid
the expenses so you could work, look for work, or go to school full time.
The Child and Dependent Care Credit is what is called a non-refundable
credit which means you have to have a tax liability to benefit from it.
That means that it will only reduce your regular income tax liability (if you
had one). Additionally, the income you have must be "earned"
income from a job or your business, and not from investments or other sources.
What is the Child and Dependent Care Credit?
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