Paying for child care or elder care can feel overwhelming, but there are smart tax breaks designed to ease the burden. Two of the most common tools are the Dependent Care FSA and the Child and Dependent Care Tax Credit. Many families miss out on savings simply because they don’t know the rules or how the two interact.
That’s why we created a free, practical 2025 guide:
Dependent Care Expenses – 2025 Guide: An Attracct Advisors Resource for Working Parents, Entrepreneurs, and Caregivers.
What You’ll Learn in This Guide
When you download this guide, you’ll discover:
- What expenses qualify as dependent care and which ones don’t
- Who counts as a dependent under IRS rules (children, spouses, and even parents)
- How the 2025 Child & Dependent Care Credit works, including income thresholds and maximum credits
- Special rules for self-employed taxpayers and household employers (like nannies or in-home caregivers)
- The difference between a Dependent Care FSA vs Tax Credit and how to combine them for maximum savings
- Common mistakes to avoid that get this credit denied
- A checklist of documents and records you’ll need for your taxes
Why This Matters
- A Dependent Care FSA lets you set aside up to $5,000 of your income pre-tax to cover qualifying care. That means lower taxable wages and immediate paycheck savings.
- The Child and Dependent Care Credit can provide up to $2,100 in tax savings, even if you don’t have access to an FSA.
- Used together (when you have more than one dependent), they can deliver thousands in combined tax benefits.
But the IRS has rules, and a single mistake, like forgetting a caregiver’s SSN or misclassifying expenses can cost you the credit.
Contact us to get your tax strategy in place.