About the Credit

• The child and dependent care credit allows you to deduct up to 35 percent of your qualifying childcare expenses. To qualify for the credit, you must have paid for the care of a qualifying individual so that you or your spouse could look for work. Qualifying individuals include a child under 13 that you can claim as a dependent on your tax return, a disabled spouse who lived with you for more than half the year or a disabled individual who lived with you for more than half the year and qualified as your dependent for tax purposes.
  
  

Multiple Caregivers

• You cannot share the child and dependent care credit with any other taxpayer. For dependents who aren't qualifying children, only a caregiver that a dependent lived with for more than half the year can claim the credit. For most qualifying children, an individual who can claim the child as a dependent can claim the credit. However, the Internal Revenue Service publishes special rules for children of divorced or separated parents.
  
  

Divorced or Separated Parents

• If you are divorced or separated from your spouse, you can consider your child a qualifying person if he was under age 13 or unable to care for himself; received more than half of his support from you and your former spouse; was in your custody or that of your former spouse for more than half the year; and you qualify as his custodial parent. The custodial parent is the parent that had custody of the child for the most nights during the tax year. If both parents had the child for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income.
  
  

Considerations

• The noncustodial parent can't claim the child and dependent care credit even if he qualifies to claim the child as a dependent on his income taxes. Though the IRS typically determines the custodial parent based on the number of nights the child spends with each individual, special rules exist for parents who work nights.