Question

Arthur is divorced with two dependent children, ages 8 and 13. His adjusted gross income is $28,000, in 2018, and he incurs qualified child care expenses of $6,000, $3,000 for each child. a. What is the amount of Arthur's qualified child care expenses after any limitation? b. Calculate the amount of Arthur's child and dependent care credit before any tax liability limitation.

Answer 1

Solution:

a). Arthur's qualified child care expenses will be $6000 which is a limit for two or more children upto the age of 13 years.

b). Arthur's qualified child care credit before any tax liability limitation will be 35 of $6000 which is $2100.