Child Tax Credit

[jgrady60]

In Turbo Tax it first asks for the amount of expenses per child in the Child and Dependent Care Credit section. If I paid a daycare school $10,000 for the year, do I enter as $5,000 per child in this section AND then enter the $10,000 in the next section that asks for the providers Tax ID number and the amount paid?  If so are these considered 2 different credits?

[rjs · Accepted solution]

First of all, the Child Tax Credit and the Child and Dependent Care Credit are two different credits. You are asking about the Child and Dependent Care Credit. The Child Tax Credit has nothing to do with daycare expenses.

Because there can be two children, and possibly multiple care providers, you have to enter the total amount you spent for each child, and also enter the total amount that you paid to each care provider. The combined total for both children has to equal the combined total for all providers. It's not two separate credits, and you are not claiming the same expenses twice. It's just two different ways of splitting up the total amount that you paid.

[JillS56 · Accepted solution]

Yes, enter the information as you have stated above.  Split the child care in half if the two children are at the daycare for the same amount of time.   However, if one child attends more than the other, they split the daycare expense according to the amount each child spends at the daycare.  Sometimes the provider will break down how much for each child.   If the provider did break down the daycare expense between the children then use how the daycare provider broke it down.

There are not two separate credits. Child and dependent care expenses have changed for 2021. You are now able to get a credit for up to 50% of eligible expenses. The amount of eligible expenses have increased from $3,000 for one qualifying person to $8,000. Additionally, for those with two or more qualifying persons, the amount of eligible expenses have increased from $6,000 to $16,000.

Answer the questions for each of your children and for the care provider and TurboTax will calculate the amount of your credit.

[jgrady60]

Exactly what I needed to know.  Thank you

[shalexusrw99]

How about if you paid a babysitter for 1 child the entire year how would you input that into the first expense box? And the second one after inputting the providers info

[MonikaK1]

How you enter the amounts depends on how much was spent for each child and whether the children had the same care provider.

For tax year 2023, the maximum amount of care expenses you're allowed to claim is $3,000 for one person, or $6,000 for two or more people. The percentage of your qualified expenses that you can claim ranges from 20% to 35% based on your income.

To add another provider or more expenses for the same child:

• Login to your account.
• Select Federal from the left menu.
• Go to Deductions and Credits.
• Scroll down to Child and Dependent Care Credit and click Update.
• Answer Yes to the question " Do you want to review your Child and Dependent Care Credit information?"
• Continue to the screen Here is what you spent on Care providers.
• Select Add another care Provider

See this TurboTax tips article and this help article for more information about the Child and Dependent Care Credit.