When families start filing their returns early next month, they can claim up to $8,000 with the child and dependent care credit.
These credits are designed to help families with the costs that go into raising and caring for a child.
Things that count toward that credit include transportation, daycare, after school programs, and even housekeepers.
This may also be claimed for those who have a dependent with disabilities that need to be taken care of.
Before 2021 the maximum parents could claim was $6,000 for two or more kids, but the American Rescue Act changed that.
How much will I get for my children in 2022?
Expenses worth up to $8,000 can be claimed for one child on your 2021 tax return, and expenses worth up to $16,000 can be claimed for two or more children.
Kids must be under age 13 to qualify, or the dependent must have a disability that requires care.
The percentage of qualifying expenses was increased from 35% to 50%, meaning parents can get back $4,000 for one child and $8,000 for two or more.
Your AGI must be under $125,000 to claim the maximum amount.
Related: Make sure to do these things before tax season ends in just two days, you could miss out on $1,000s
Anyone with an income over $438,000 will not qualify.
How do I claim this credit?
The credit can be claimed in 2022 on your 2021 tax return.
Form 2441 for this credit needs to be completed and filed with your tax return.
You’ll need the Social Security number for qualifying people.
If you file electronically you will see your refund processed faster, and if you choose direct deposit it will be issued faster.
This credit is potentially refundable, so you don’t need to owe taxes to claim it.
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