IRS Publication 503: Child And Dependent Care Expenses

IRS Publication 503 is a document published every year by the Internal Revenue Service laying out the criteria that must be met for a taxpayer to claim the Child and Dependent Care Credit.

The Internal Revenue Service (IRS), the agency in charge of collecting federal taxes, posts Publication 503 to its website. The document lays out the conditions under which a taxpayer can claim the nonrefundable Child and Dependent Care Credit. Because the cost of caring for a child or dependent is often greater than a second income, there can be an incentive for second earners to stop working and care for children or dependents. The credit is designed to counteract that incentive and allow a taxpayer or their spouse to be gainfully employed while providing care. The credit is not only available to couples, however, and can be claimed by single filers.

In order to claim the credit, certain criteria must be met: the persons claimed must be qualified, the taxpayer must have earned income, expenses must be incurred so that the taxpayer could work or look for work, and care payments must be made to a non-dependent.

Up to 35% of expenses related to the care of children and dependents can be claimed by a taxpayer. In addition, expenses related to the care of children apply only to children under the age of 13.