Learn About Child Care Tax Credits

How To Qualify for The Child Tax Credit & Save Huge On Your Taxes

It’s not inexpensive to have a child. Every little bit adds up. It is estimated that child care costs are the largest expense in families’ monthly budgets. On average, it costs a quarter-million dollars to provide support for a child up until age 17.

How can you get financial help for your family? You can get funding through grants and subsidies so that you don’t miss out on any funds you may be eligible for.

Government Programs

There are governments programs that offer funding and subsidies, so let’s check them out and see what you are eligible for.

Childcare Assistance Program

There are governments programs that offer funding and subsidies, so let’s check them out and see what you are eligible for.

Head Start and Early Head Start for at-risk children

Apply at Headstart ECLKC for programs to prepare your child for success in school. To qualify your household income needs to be at or below the poverty level.

State-funded prekindergarten for at-risk children:

Apply at Childcare.gov by going to the Child Development & Early Learning tab for the Pre-Kindergarten Program. Eligibility isn’t based on income alone. Other factors include risk factors and eligibility is determined locally. This program offers preschool programs to keep these children on the same level of school as their peers.

Military Childcare Assistance

Apply at Childcare.gov if your child has a parent who serves in the military. You could receive up to $1,500 per child per month.

Work- and School-Related Programs

Assistance for high school students

Apply at Childcareaware.org where some states offer childcare assistance for high school students who need childcare to finish school. Eligibility is determined at a local level.

College or university Childcare

Apply at Childcareaware.org where some colleges and universities offer childcare options on campus. Additionally, these programs may offer discounts for students, faculty, and staff. Eligibility is determined at the state level.

Local and Provider-Specific Assistance and Discounts

Local assistance and scholarships

Apply at Childcareware.org for local assistance and scholarship opportunities. Eligibility is determined locally and based on need.

PA4Kids Scholarship

Apply at PA4Kids.com for scholarship opportunities. Eligibility and amount is determined at a local level.

Native Hawaiian, Native Alaskan, and American Indian Programs

American Indian and Alaska Native Assistance

Apply at Childcareta.acf.hhs.gov for assistance. Eligibility is based on having American Indian or Alaska Native family heritage and the amount is determined at the local level.

Native Hawaiian Childcare and preschool programs

Apply at Human Services.Hawaii.gov for assistance. Eligibility is based on native Hawaiian or Native Hawaiian Ancestry and the amount is determined after applying. 

2021 Child Tax Credit

One thing is on every parents’ mind as they start the new year. You will have to address taxes before April. It’s time again to gather your receipts, notes, and file for what they hope will be a nice return.

There’s good news for parents who have survived the pandemic. Here’s how to make sure your child gets the tax credit this year.

You can claim three tax credits as a parent depending on your eligibility. One credit is for supporting dependents, one is for childcare and the third is based upon income and whether you require extra support. How do you determine if you are eligible for additional credits that will maximize the 2021 tax return? Let’s break it down.

Child Tax Credit

To qualify you must:

  • The dependent must be legally your daughter or son. Check the IRS page for more details.
  • You support a child who is 17 years or younger at the end of 2021. (This is one year older than what was previously accepted.)
  • The child did not provide half of their support
  • The child lived with you for at least half the year
  • You claim the child as a dependent on your tax return
  • The child cannot file a joint return for the year (or files it only to claim a refund of withheld income tax or estimated tax paid).
  • The child was a U.S. citizen, U.S. national, or U.S. resident alien.

If you qualify you must fill out the Child Tax Credit form when you file your taxes.

Earned Income Credit

To qualify you must: 

  • The dependent can be any age but permanently disabled at any time during the year. Or, the dependent is 19 years old and younger than you and your spouse. Or, if you care for someone who is under age 24 at the end of the year and a full-time student for at least 5 months of the year and younger than you (or your spouse, if you file a joint return), you can also claim the credit.
  • Your income for 2021 was low- to moderate.
  • The relationship of the dependent has to fall into one of these categories: Son, daughter, stepchild, adopted child or foster child, brother, sister, half-brother, half-sister, stepsister or stepbrother, grandchild, niece or nephew
  • The child must live in the same home as you for half of the year.
  • And dependent must be incapable of filing a joint return with someone else.

If you meet these qualifications you can apply at IRS.gov.

Childcare Tax Credit

To qualify you must:

  • You or your spouse paid for childcare in 2021
  • Identify all people or organizations who cared for your child in 2021
  • Your child is under the age of 13
  • You live in one of the 50 United States

To apply for the Childcare Tax Credit, fill out Form 2441 when filing taxes.

Don’t Miss Out On Anything You Are Eligible For

Being a parent is challenging enough – but being a parent through the pandemic is even more so. Costs are rising for everything from food, gas, housing, childcare, and more. There are many programs available for assistance the trick is knowing what they are, what the qualifications are, and how to apply.