According to IRS Publication 503, you can take the Child and Dependent Care Credit 'so you (and your spouse if filing jointly) can work or look for work.' My wife and I are filing jointly and in 2018 one of us worked full time while the other was actively looking for work. We enrolled our 2 year old in pre-k and had a nanny watch him several times a week when neither of us were home to watch him. We incurred this child care expense while one of us was working full time and the other was actively seeking work. Our dynamic seems to be precisely aligned with the spirit of this credit, especially with one parent actively seeking work due to a loss of previous income. We seem like the archetype for those who could really use this credit. Just because one of us didn't show earned income in 2018, we cannot take this credit? We meet all the other criteria. To me, it seems that the spirit of this publication was drafted to reflect if one parent is a homemaker than they should be home as the care provider, and therefore, unable to take this child care expense credit. That would make sense, but that was not the case in our household.
Any advice on how to handle would be sincerely appreciated! How can we prove this?
Unfortunately, if one of the spouses does not have earned income, or is a student or disabled, the credit for child and dependent care expenses is not allowed. I understand your frustration, but that's the way the law is written.