Dependent Care Credit Calculator
| AGI | Credit rate |
|---|---|
| $0 – $15,000 | 35% |
| $15,001 – $17,000 | 34% |
| $17,001 – $19,000 | 33% |
| $19,001 – $21,000 | 32% |
| $21,001 – $23,000 | 31% |
| $23,001 – $25,000 | 30% |
| $25,001 – $27,000 | 29% |
| $27,001 – $29,000 | 28% |
| $29,001 – $31,000 | 27% |
| $31,001 – $33,000 | 26% |
| $33,001 – $35,000 | 25% |
| $35,001 – $37,000 | 24% |
| $37,001 – $39,000 | 23% |
| $39,001 – $41,000 | 22% |
| $41,001 – $43,000 | 21% |
| $43,001 and over | 20% |
The child and dependent care credit refunds a slice of daycare, camp and babysitter costs - but through a sliding ladder, not a flat rate: 35% of qualified expenses at $15,000 of AGI, sliding one point per $2,000 of income down to a 20% floor. This calculator runs the ladder verbatim from 26 U.S.C. § 21, capped at $3,000 of expenses for one dependent or $6,000 for two or more.
The companion trap: the same dollars cannot also run through a dependent care FSA - and the FSA is usually the better deal at higher incomes, which makes the ordering decision worth ten minutes each open enrollment.
How to use
- Enter AGI, qualifying care expenses and the number of dependents - the credit and its rate compute live.
- Read the rate table for the full 35%-to-20% ladder; the bands are $2,000 wide and end at $43,000.
- Remember the employment test: both spouses must have earned income (with student/disabled exceptions) for any credit at all.
Frequently asked questions
Can I use both the FSA and the credit on the same expenses?
No - dollars reimbursed by a dependent care FSA cannot also feed the credit. You may split expenses between them (FSA first, since its exclusion is worth more at higher rates), but the credit only applies to expenses beyond the $5,000 FSA reimbursement.
Do summer camps and day camps qualify?
Yes - day camp costs count as qualifying care even for specialty camps, as long as the care lets you (and your spouse) work or look for work. The exception that surprises everyone: overnight camp does not qualify, because the statute counts expenses for care while you work, not boarding.
What are the earned income rules for married couples?
Both spouses generally need earned income - wages, salary, self-employment - and the credit is computed on the LOWER of the two incomes or the expense cap, whichever is smallest. A student or disabled spouse is deemed to have $250-$500 of earned income per month, an exception that keeps full-time students eligible.
Why does the credit disappear at high incomes but the FSA does not?
The credit’s rate slides from 35% to a 20% floor by $43,000 of AGI but never hits zero - even millionaires technically qualify on the first $6,000. The FSA exclusion has no AGI phase-out at all, which is why at higher incomes the payroll route dominates on taxes while the credit still helps against liability.