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Dependent Care Credit Question

Forum|Forum|3 years ago
April 16, 2023
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My spouse and I both have Dependent Care FSA's of $5,000 each. We had daycare expenses of $13,000 for our one child. I thought the $3,000 would be eligible for the credit, but Turbo Tax is adding $5,000 to our income and not giving us the credit at all. Is this correct?

Best answer by MAK70

The maximum amount that can be excluded from taxable income for child care expenses is $5,000 so the $5,000 of additional income is correct. For the child care credit, any employer provided benefits are deducted from the amount of your credit. Since the max for one child is $3,000 you cannot claim the credit.

M

MAK70Answer

The maximum amount that can be excluded from taxable income for child care expenses is $5,000 so the $5,000 of additional income is correct. For the child care credit, any employer provided benefits are deducted from the amount of your credit. Since the max for one child is $3,000 you cannot claim the credit.