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Child and Dependent Care Credit for 2022
The Child and Dependent Care Credit provides a tax break for many parents who are responsible for the cost of childcare. Though the credit is geared toward working parents or guardians, taxpayers who were full-time students or who were unemployed for part of the year may also qualify.
If you paid a daycare center, babysitter, summer camp, or other care provider to care for a qualifying child under age 13 or a disabled dependent of any age, you may qualify for a tax credit on your 2022 taxes of up to 35% of:
- up to $3,000 of qualifying expenses (for a maximum credit of $1,050) for one child or dependent, or
- up to $6,000 of qualifying (for a maximum credit of $2,100) for two or more children or dependents.
For example, for tax year 2022 a taxpayer with one qualifying person, $3,000 in qualifying expenses and an AGI of $60,000 would qualify for a nonrefundable credit of approximately $600 (20% x $3,000). By contrast, under the new law for tax year 2021 only, a taxpayer with the same circumstances can potentially claim a refundable credit of approximately $1,500 (50% x $3,000).
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