By Rosalyn Partin, Manchester H&R Block
There is a significant and exciting change to the Child and Dependent Care credit for 2021 tax returns.
The Child and Dependent Care credit allows families to claim expenses related to the care of a child or someone who is physically or mentally unable to care for themselves.
Families who pay for care while the parents work or attend school may claim a refundable credit of up to 50% of qualifying expenses, meaning they could claim a maximum credit of:
- $4,000 for one qualifying child (based on $8,000 of expenses)
- $8,000 for two or more qualifying children (based on $16,000 of expenses)
In previous years the credit only helped by reducing the income tax on the return. However, as a refundable credit, this tax benefit not only lowers the tax you owe, it also can mean getting money back. Additionally, the amount of the credit has been increased for 2021.
In order to claim the Child and Dependent Care credit you must have the tax identification number or social security number, name, and address of the person or facility you pay. You (and your spouse) must have earned income or have been a student during the tax year.
Call now to schedule your appointment with one of our tax professionals at H&R Block. Open Monday through Friday 9am-7pm and Saturday 9am-5pm. As always, we also accept walk-in clients at your convenience.
If you have questions or want to schedule an appointment, please call H&R Block in Manchester TN at 931-728-9462. H&R Block Has Your Back!
