I have entered child care expenses for a licensed daycare. I keep getting that I can't take that credit because there is no earned income. I am not sure I understand.

I did check and wage is listed as mine and the retirement income is listed as my spouse.  This is the same employer I have worked for many years so it's not like it would be a partnership.  We are listed as married filing jointly and we do have a tax liability so it's not that it would be credit so to speak.  Not self-employment either.  I am still baffled.  I did start the return when my W2 came in and then restarted last week.  I may just wipe it all out and start all over.  Perhaps there was a software update that has confused things.

Common reasons for error with the child and dependent care credit are:

• By far the most common error occurs when wages for both husband and wife are entered as only wages for one of them, leading the program to believe that the other does not have any earned income. Go back and check to see that your wages were entered under your name, and your spouse's wages were entered under their name. The screenshot below shows what happens when you go back to the section on income and then select "update" for wages to find out if they were listed under the same spouse. Another common error is that you are self-employed and had a loss. A loss is not earned income and will not make you eligible for the credit.
• Another common error is your income is from a partnership not identified as self-employment income, or is from an S-Corporation but isn't wages.
• Another common reason is that you are married filing separately, which does not allow a child care credit.
• You also must have a tax liability. The child care credit can reduce your taxes to $0 but cannot cause a refund. If you are already getting everything back that you paid in, the credit will result in no further refund.
• Another common error is considering that a self-employment loss is earned income.  It is not.