What Is The Maximum Amount Of Tax Credits For Child Care?

Child and dependent care credit is a tax benefit that allows taxpayers to claim up to $3,000 of qualifying expenses for one child or dependent, or up to $6,000 for two or more children or dependents. The credit percentage phases down depending on income, and taxpayers can claim from 20 to 35 of their care expenses up to a maximum of $3,000 for one person or $6,000 for two or more people in tax year 2023.

For 2024, the child tax credit will be worth $2,000 per qualifying dependent child if your MAGI is $400,000 or below (married). Taxpayers who are paying someone to take care of their children or another member of household while they work may qualify for this credit. The Daycare Credit allows between 20 to 35 care-related expenses, depending on your MAGI or modified adjusted gross income.

The maximum credit available to families at this income level is $1,050 (35 of $3,000 in expenses) for one dependent and $2,100 (35 of $6,000 in expenses). The dollar limit for claiming the credit is $4,000 (50 percent of $8,000) for one qualifying individual and $8,000 (50 percent of $16,000) for two or more dependents.

The maximum refund for the 2024 tax year is capped at $1,700 per qualifying dependent. If you have three or more dependents, you are eligible for the childcare benefit for a maximum of 230 hours per month per child. However, the additional child tax credit (ACTC) allows you to receive up to a maximum of $1,700 per child as a refund for the 2024 tax year.