Child and Dependent Care Credit information

[HOPE2]

IRS SAYS: Who is eligible to claim the credit

You may be eligible if:

• You (and your spouse if filing a joint return) have earned income.
• You paid qualified expenses for the care of a qualifying individual to enable you (and your spouse, if filing a joint return) to work or actively look for work

• ------My client had a job in 2025, but his wife lost her job in December 2024. In 2025, they paid for daycare for their child, but despite many attempts, she was unable to find a job during the year.

  I understand that they are not eligible for the Child and Dependent Care Credit, but what exactly does “looking for work” mean in this context?

[Jim-from-Ohio]

Working or Looking for Work

To be work related, your expenses must allow you to work or look for work. If you are married, you or your spouse must work or look for work. Note, however, that employment-related expenses are limited to the lower of the earned income of you or your spouse. If you or your spouse was a full-time student or disabled, see Rule for student-spouse or spouse not able to care for self, earlier.

Your work can be for others or in your own business or partnership. It can be either full-time or part-time and it can be either in or out of your home.

Work also includes actively looking for work. However, if you don't find a job and have no earned income for the year, you can't take this credit. See You Must Have Earned Income, earlier.

An expense isn't considered work related merely because you had it while you were working. The purpose of the expense must be to allow you to work. Whether your expenses allow you to work or look for work depends on the facts.

Example 1. 

The cost of a babysitter while you and your spouse go out to eat isn't normally a work-related expense.

Example 2. 

You work during the day. Your spouse works at night and sleeps during the day. You pay for care of your 5-year-old child during the hours when you are working and your spouse is sleeping. Your expenses are considered work related.

Volunteer work. 

For this purpose, you aren't considered to be working if you do unpaid volunteer work or work for a nominal salary.

Work for part of year. 

If you work or actively look for work during only part of the period covered by the expenses, then you must figure your expenses for each day. For example, if you work all year and pay care expenses of $250 a month ($3,000 for the year), all the expenses are work related. However, if you work or look for work for only 2 months and 15 days during the year and pay expenses of $250 a month, your work-related expenses are limited to $625 (2½ months × $250).

Temporary absence from work. 

You don't have to figure your expenses for each day during a short, temporary absence from work, such as for vacation or a minor illness, if you have to pay for care anyway. Instead, you can figure your credit including the expenses you paid for the period of absence. 

An absence of 2 weeks or less is a short, temporary absence. An absence of more than 2 weeks may be considered a short, temporary absence, depending on the circumstances.

Example 1. 

You pay a dependent care center, which complies with all state and local regulations, to care for your 2-year-old daughter so you can work full-time. The center requires payment for days when a child is absent. You take 8 days off from work as vacation days. Because the absence is less than 2 consecutive calendar weeks, your absence is a short, temporary absence. You aren't required to allocate expenses between days worked and days not worked. The entire fee for the period that includes the 8 vacation days may be a work-related expense.

Example 2. 

You pay a nanny to care for your 2-year-old son and 4-year-old daughter so you can work. You become ill and miss 4 months of work but receive sick pay. You continue to pay the nanny to care for the children while you are ill. Your absence isn't a short, temporary absence, and your expenses aren't considered work related.

Part-time work. 

If you work part-time, you must generally figure your expenses for each day. However, if you are required to pay for care weekly, monthly, or in another way that includes both days worked and days not worked, you can figure your credit including the expenses you paid for days you didn't work. Any day when you work at least 1 hour is a day of work.

Example 1. 

You work 3 days a week. While you work, your 6-year-old child attends a dependent care center, which complies with all state and local regulations. You can pay the center $150 for any 3 days a week or $250 for 5 days a week. Your child attends the center 5 days a week. You must allocate your expenses for dependent care between days worked and days not worked; your work-related expenses are limited to $150 a week.

Example 2. 

The facts are the same as in Example 1, except the center doesn't offer a 3-day option. The entire $250 weekly fee may be a work-related expense.

[BobKamman]

In the context of Form 2441, "looking for work" means that it worked, and you didn't go all year without a job.  

[HOPE2]

Thanks@jim-from-ohio

Thank you from you. I had actually already read this material before. Now, regarding my question, what should I do when filing in ProSeries—where should I mark that the spouse was job-seeking and had no income, and that we want to use the credit?

[HOPE2]

thanks@Bobkamman 

I could not find it

[TaxGuyBill]

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@HOPE2 wrote:

where should I mark that the spouse was job-seeking and had no income, and that we want to use the credit?

---

As your first bullet point says, the spouse ALSO needs to have earned income.  No earned income means no credit.

Paying for child care for work or looking for work is only one of the requirements.  They still need to have earned income.