If you paid someone last year to care for a child under age 13, you may be able to claim a tax benefit on your 2008 tax return. That’s true if you’re a single parent; if you’re married, you can claim the Child and Dependent Care tax credit if the child care enabled both spouses to go to work, look for work, or go to school full-time.
The amount of this tax credit varies according to your income. The lower your income, the greater the tax break you can claim. The smallest tax credit–20 percent–is offered to taxpayers with adjusted gross income (AGI) over $43,000. If your AGI is over $43,000, here’s what you can claim:
* One child. The maximum tax credit is $600. To get this credit, you must have spent at least $3,000 on child care.
* Two or more children. The maximum tax credit is $1,200, which you can claim if you spent at least $6,000 on care for those youngsters.
You can count money you spent on nursery school, day care centers, household help, and day camp towards the $3,000 or $6,000 in qualified expenses. However, any money you spent for overnight camp is not an eligible expense for this tax credit.
Also, you must reduce your eligible expenses by any amounts provided by an employer’s dependent care benefits plan.
