Dependent Care FSA versus Childcare Tax Credit

If your employer offers a dependent-care flex plan, that’s usually a better deal than taking the child-care tax credit. Money you set aside in a flexible spending account is not only deducted from your gross salary before income taxes are calculated but also avoids the 7.65% Social Security and Medicare tax.

How much is the credit for child and dependent care expenses?

$8,000

You can get up to $8,000 back in tax credit for child-care expenses. Here’s what you need to know. For your 2021 tax return, the cap on expenses eligible for the child and dependent care tax credit is $8,000 for one child (up from $3,000) or $16,000 (up from $6,000) for two or more.

How much was the 3rd stimulus check?

$1,400 per person

The full amount of the third stimulus payment is $1,400 per person ($2,800 for married couples filing a joint tax return) and an additional $1,400 for each qualifying dependent.