Child and Dependent Care Credit- both parents are working and the system is showing not eligible

[VolvoGirl]

Have you entered all your income yet?  Make sure you are each showing income.  Check each W2, should be assigned to the right spouse.   If you have self employment income you need to have a profit to qualify.

[CSKcpa56]

Not sure what is going on. Pub 905 says you should be able to claim the credit if you meet all these tests?

Tests you must meet to claim a credit for child and dependent care expenses.

To be able to claim the credit for child and dependent care expenses, you must meet all the following tests.

1. Qualifying Person Test. The care must be for one or more qualifying persons who are identified on Form 2441.

2. Earned Income Test. You (and your spouse if filing jointly) must have earned income during the year. 

3. Work-Related Expense Test. You must pay child and dependent care expenses so you (or your spouse if filing jointly) can work or look for work.

4. You must make payments for child and dependent care to someone you (and your spouse) can't claim as a dependent. If you make payments to your child (including stepchild or foster child), he or she can't be your dependent and must be age 19 or older by the end of the year. You can't make payments to:

   1. Your spouse, or

   2. The parent of your qualifying person if your qualifying person is your child and under age 13.

5. Joint Return Test. Your filing status may be single, head of household, or qualifying surviving spouse. If you are married, you must file a joint return, unless an exception applies to you. 

6. Provider Identification Test. You must identify the care provider on your tax return.

7. If you exclude or deduct dependent care benefits provided by a dependent care benefit plan, the total amount you exclude or deduct must be less than the dollar limit for qualifying expenses (generally, $3,000 if you had one qualifying person or $6,000 if you had two or more qualifying persons) in order for you to claim a credit on the remaining amount. (If you had two or more qualifying persons, the amount you exclude or deduct will always be less than the dollar limit because the total amount you can exclude or deduct is limited to $5,000.

[SabrinaD2]

If TurboTax is showing that you're not eligible for the Child and Dependent Care Credit despite both parents working, there could be a few reasons. 

Here’s how you can check and verify the necessary details:

• Both you and your spouse must have earned income. If one spouse has no income, the credit can be disallowed.
• Ensure the care expenses are for a qualifying person, such as a dependent child under age 13.
• You must be filing jointly. The credit is generally not available if you are filing as Married Filing Separately
• You need to provide the care provider's name, address, and their SSN, ITIN, or EIN

How to Check and Verify Details in TurboTax:

Check W-2s:

• TurboTax Online: Use the search magnifying glass at the top right and type "W-2." Click the "Jump to" link to go directly to the W-2 section

Verify Filing Status:

• TurboTax Online: Go to Personal Info and ensure your filing status is set to "Married Filing Jointly"

Verify Care Provider Details:

• TurboTax Online: Use the search magnifying glass and type "Child and Dependent Care Credit." Click the "Jump to" link to go directly to the care provider section. Enter the provider's name, address, and SSN, ITIN, or EIN

For more detailed guidance, you can refer to:

• TurboTax Community
• IRS Child and Dependent Care Credit FAQs