Child & Dependent Care Assistance – American Rescue Plan
This article organizes the original guidance on child & dependent care assistance – american rescue plan into clear sections for easier reading and reference.
Key Points
This section presents the original list items in a more scannable format.
- The child and dependent care credit has been increased from 35% to 50% of eligible expenses for 2021 only and is also refundable.
- The credit is now worth up to $8,000 for one qualifying individual and up to $16,000 for two or more (an increase from being worth up to $3,000 for one qualifying individual and $6,000 for two or more).
- The phase-out to reduce the credit begins when adjusted gross income reaches $125,000. After adjusted gross income reaches $125,000, the credit percentage is reduced by one point for each $2,000 of adjusted gross income over $125,000, until it reaches 20%. After adjusted gross income reaches $400,000, the credit percentage is reduced by one point for each $2,000 of adjusted gross income over $400,000, until it reaches 0.
- The exclusion for employer-provided dependent care assistance has been increased to $10,500 for 2021.
Related Resources
These resources connect the article topic with related Bowers service pages and approved professional reading.
FAQ
The questions below summarize the main points already covered in the article.
What is the main focus of Child & Dependent Care Assistance – American Rescue Plan?
The article focuses on child & dependent care assistance – american rescue plan and organizes the original guidance into sections for easier review.
What topics does the article cover first?
The article begins with key points and then continues through the remaining points in the original post.
Does the post include action items or reminders?
Yes. The original post includes listed items that have been kept in list format for easier scanning.
Was the original post wording changed?
The revision keeps the author wording and updates the structure so the post is easier to read online.