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Client Question: Do I Include my Children’s Medical Expenses in our Child and Dependent Care Expenses?

Posted by McDonald & Osborne Posted on Oct 12 2015

These are two separate items on a tax return. Medical expenses for children are included with the medical expenses for the taxpayer, if the taxpayer is itemizing deductions. Child and dependent care expenses are used to figure the Child and Dependent Care Credit.

The Child and Dependent Care Credit is a non-refundable tax credit for unreimbursed childcare expenses paid by working taxpayers. It is designed to encourage taxpayers to pay childcare expenses so that they can remain gainfully employed. Up to 35% of expenses related to the care of children and dependents can be claimed by a taxpayer. The taxpayer, the care provider, the dependent(s) must all meet certain requirements in order for the taxpayer to qualify for the credit:

  • The person(s) claimed must be a qualifying person.
  • The taxpayer (or spouse, if filing jointly) must have earned income for the year.
  • Expenses must be incurred so that the taxpayer (or spouse, if filing jointly) can work or look for work.
  • Care payments must be made to a provider who is a non-dependent.
  • Expenses related to the care of children only apply to children under the age of 13.

The Child and Dependent Care Credit is claimed on Form 2441 of Form 1040 .

Medical and dental expenses, however, are itemized deductions and reported on Schedule A of Form 1040. This would include any medical or dental expenses incurred by the taxpayer, spouse (if filing jointly) and dependent(s) in the tax year. The IRS defines a medical expense as “the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatment affecting any part of function of the body.”

Taxpayers can deduct only medical expenses that are more than 7.5% of their adjusted gross income. If the total is less than that, the taxpayer will not be able to claim the expenses.

For more information on the Child and Dependent Care Credit, see IRS Publication 503 . For more information relating to Medical and Dental Expenses, see IRS Publication 502 .