2018 Child and Dependent Care Credit
For 2018, the Child and Dependent Care Credit is 35% (Maximum rate), $3,000 (Expense limit, one person) and $6,000 (Expense limit, two or more people).
Effective 2018-01-01Source: Publication 503 (2018), Child and Dependent Care Expenses (IRS)Verified 2026-08-29
Compared with 2017
Every figure on this page is unchanged from 2017.
| Item | 2017 | 2018 | Change |
|---|---|---|---|
| Maximum rate | 35% | 35% | +0% (+0.0%) |
| Expense limit, one person | $3,000 | $3,000 | +$0 (+0.0%) |
| Expense limit, two or more people | $6,000 | $6,000 | +$0 (+0.0%) |
Who it applies to
Taxpayers who paid work-related care expenses in 2018 for a qualifying person, such as a child under age 13 or a dependent or spouse who is unable to care for himself or herself.
What changed this year, and why
For tax year 2018, the Child and Dependent Care Credit allows a credit at a maximum rate of 35% of qualifying work-related care expenses. The expense limit is $3,000 for one qualifying person or $6,000 for two or more qualifying persons. The percentage applied to those expenses declines as the taxpayer's adjusted gross income increases.
Common questions
- How is the Child and Dependent Care Credit calculated?
- The credit is based on work-related care expenses you paid for a qualifying person, such as a child under age 13 or a spouse or dependent who cannot care for himself or herself. You apply a percentage to those expenses (up to the dollar limit) and the result is your credit.
- Is the rate always 35%?
- No. The maximum rate is 35%. The percentage decreases as the taxpayer's adjusted gross income rises.
The credit cannot exceed what you earned
The credit is capped by what you actually earned during the year. For a single taxpayer, the work-related expenses used to compute the credit cannot exceed that taxpayer's earned income. For a married couple, the cap is the smaller of the two spouses' earned incomes - even if they were married for only part of the year, the spouse's full-year earned income is used. If you are legally separated or married and living apart (meeting the tests under the filing-status rules), you are treated as unmarried for this purpose and only your own income counts. This limit applies on top of the dollar limits ($3,000 for one qualifying person, $6,000 for two or more) and the 35% maximum credit rate; the credit ultimately rests on the smallest of all the applicable limits.
Earned Income Limit The amount of work-related expenses you use to figure your credit can't be more than: 1. Your earned income for the year if you are single at the end of the year, or 2. The smaller of your or your spouse's earned income for the year if you are married at the end of the year.
Publication 503 (2018), Child and Dependent Care Expenses (IRS)
The exception for a student or disabled spouse
If one spouse did not work, the couple can still qualify by treating that spouse as having earned income for any month he or she was either a full-time student or physically or mentally unable to care for himself or herself. The nonworking spouse must also have lived with the taxpayer for more than half the year. Full-time student status requires enrollment at a school (high school, college, university, or technical/trade school) for some part of at least five calendar months during the year; the months need not be consecutive. The rule applies to only one spouse per month - if both spouses were students or disabled in the same month, only one can be treated as having earned income for that month. This deemed-income rule feeds into the earned income limit, allowing the credit to be based on the working spouse's actual earnings rather than reduced to zero.
Rule for student-spouse or spouse not able to care for self. Your spouse is treated as having earned income for any month that he or she is: 1. A full-time student, or 2. Physically or mentally not able to care for himself or herself. (Your spouse also must live with you for more than half the year.)
Publication 503 (2018), Child and Dependent Care Expenses (IRS)
Married couples generally must file jointly
Married taxpayers generally must file a joint return to claim this credit. The allowed filing statuses for claiming the credit are single, head of household, or qualifying widow(er) with dependent child. If you are married at the end of the year and do not qualify for one of those statuses - for example, you lived with your spouse for the full year and did not meet the tests for being considered unmarried - you and your spouse must file jointly. A surviving spouse who does not remarry before year-end must also generally file jointly. If you file as married filing separately without meeting an exception, the credit is not available.
5. Joint Return Test. Your filing status may be single, head of household, or qualifying widow(er) with de- pendent child.
Publication 503 (2018), Child and Dependent Care Expenses (IRS)
You must name the provider, or show due diligence
To claim the credit, you must identify every person or organization that provided care by listing the provider's name, address, and taxpayer identification number on Form 2441, Part I. For an individual provider, the identification number is a Social Security Number or Individual Taxpayer Identification Number; for an organization, it is the Employer Identification Number. Tax-exempt organizations (such as a church or school) are an exception - enter "Tax-Exempt" instead of a number. If you cannot supply complete or correct information, you must show that you exercised due diligence in trying to obtain it. Form W-10 can be used to request the details from the provider; alternative sources include a copy of the provider's Social Security card, a Form W-4 for a household employee, or an invoice or letter from the provider.
Care Provider Identification Test You must identify all persons or organizations that provide care for your child or dependent.
Publication 503 (2018), Child and Dependent Care Expenses (IRS)
Employer benefits shrink the expense limit
When an employer provides dependent care benefits that are excluded or deducted from income, that benefit amount must be subtracted from the otherwise applicable dollar limit. The base limit is $3,000 for one qualifying person or $6,000 for two or more. The reduced limit is computed on Form 2441, Part III, and becomes the new cap on the work-related expenses that can be used to figure the credit. The reduction cannot make the limit negative; any excess benefits above the dollar limit are simply excluded. The 35% maximum credit rate is then applied to expenses within this reduced limit. This rule ensures that employer-provided benefits do not combine with out-of-pocket expenses to exceed the statutory cap.
Reduced Dollar Limit If you received dependent care benefits that you exclude or deduct from your income, you must subtract that amount from the dollar limit that applies to you.
Publication 503 (2018), Child and Dependent Care Expenses (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Publication 503 (2018), Child and Dependent Care Expenses (IRS)
- Maximum rate
The credit can be up to 35% of your expenses.
- Expense limit, one person
This limit is $3,000 for one qualifying person, or $6,000 for two or more qualifying persons.
- Expense limit, two or more people
If you paid work-related expenses for the care of two or more qualifying persons, the applicable dollar limit is $6,000.