Child and dependent care credit: daycare, camps and after-school
What care counts, how much of it the credit reaches, why both spouses need earned income, and what your provider has to give you before the return is filed.
Quick answers
- Does summer camp count for the child and dependent care credit?
- Day camp generally counts when it let you work or look for work. Overnight camp does not, at any age, and tuition for kindergarten or a higher grade is treated as education rather than care.
- Can I claim the care credit if my spouse did not work?
- Generally no. Both spouses need earned income on a joint return, and the counted expenses cannot exceed the lower of the two. A spouse who was a full-time student or unable to care for themselves is treated as having deemed earned income for those months.
- What do I need from my daycare provider?
- Form 2441 asks for each provider's name, address and taxpayer identification number, along with what you paid. Ask for a completed Form W-10 or a year-end statement; without the number the credit can be denied unless you show you asked in good faith.
This credit covers what you paid someone else to care for a child or a disabled family member so that you could work. It is figured on Form 2441, it is not refundable, and the amount of spending it reaches is capped well below what care actually costs in most of Houston.
| Care expenses counted, one qualifying person | $3,000 | 2025 Form 2441 line 3 |
|---|---|---|
| Care expenses counted, two or more qualifying persons | $6,000 | 2025 Form 2441 line 3 |
| Highest care-credit rate | 35% | 2025 Form 2441 line 8 table |
| Lowest care-credit rate | 20% | 2025 Form 2441 line 8 table |
| Dependent-care benefits excludable from income | $5,000 | 2025 Form 2441 line 21 |
Who is a qualifying person
Three groups qualify: your dependent child who was under 13 when the care was given, your spouse who is physically or mentally incapable of self-care and lived with you more than half the year, and any other person in the same condition who lived with you more than half the year and either is your dependent or would be but for their own income or filing situation.
For divorced or separated parents, the credit follows the custodial parent — the one the child lived with for the greater number of nights — even when the other parent claims the child as a dependent under a signed release.
What counts as care
The test is whether the expense was for the person's well-being and protection while you worked or looked for work. Daycare, a licensed center, a preschool, a nanny or sitter, before-school and after-school programs and day camp all qualify.
Overnight camp does not, at any age. Neither does tuition for kindergarten or a higher grade, which the IRS treats as education rather than care, nor payments to certain people close to you: your spouse, the qualifying child's other parent, your own child under 19, or anyone you claim as a dependent. Transportation you pay for separately, and food or lodging billed apart from the care itself, generally fall outside as well.
How much the credit is
Two limits stack. First, only so much of what you spend is counted: up to $3,000 for one qualifying person, or $6,000 for two or more. The larger cap applies to the household, so it holds even when almost all of the spending was for one of two children.
Second, a percentage is applied to whatever survives that cap. The rate is 35% for households with adjusted gross income up to $15,000 and steps down in bands as income rises, reaching 20% once income passes $43,000. Most working households land at the bottom rate, so the practical outcome for two children in full-time care is the lower percentage of the expense cap rather than a share of what was actually spent.
Because the credit is not refundable, it can only reduce tax you owe. A household with no tax after other credits gets nothing from it.
Both spouses need earned income
You need earned income to claim this credit, and on a joint return both spouses do. The counted expenses cannot exceed your earned income, or the lower of the two on a joint return, which is what rules the credit out when one spouse did not work at all during the year.
There are two exceptions. For any month a spouse was a full-time student or was incapable of self-care, that spouse is treated as having a set amount of deemed earned income, at a higher monthly figure when there are two or more qualifying persons. It is enough to keep a credit alive while one parent is in school; the return has to note the months involved.
Married filing separately usually rules the credit out. A spouse who lived apart from the other for the last six months of the year, kept up a home that was the qualifying person's main home for more than half the year, and paid more than half the cost of that home, can claim it while filing separately.
Dependent care benefits from work
If your employer offers a dependent care FSA, what you set aside appears in box 10 of your W-2, and up to $5,000 of it can be excluded from your income. That exclusion and this credit reach the same dollars, so benefits you excluded come off the expenses the credit is figured on.
What to collect from the provider
Form 2441 asks for each provider's name, address and taxpayer identification number — an EIN for a center, a Social Security number for an individual — along with what you paid them. Without it the credit can be denied unless you can show you asked in good faith and were refused.
- Ask each provider for a completed Form W-10 or a year-end statement showing their name, address and tax ID.
- Keep the receipts, matched to the months of care.
- Reconcile box 10 of your W-2 against what you actually spent before the return is prepared.