Pennsylvania Schedule DC is used to claim the Pennsylvania Child and Dependent Care Enhancement Tax Credit. This refundable credit is available to eligible taxpayers who incur child or dependent care expenses and qualify for the federal Child and Dependent Care Credit.
Who Can Claim the Pennsylvania Child and Dependent Care Enhancement Tax Credit?
To claim the credit, you must:
- Be eligible for the federal Child and Dependent Care Credit.
- Claim the expenses on your federal return.
- Include a completed Federal Form 2441 and Schedule 3 with your Pennsylvania return.
Generally, married taxpayers must file a joint return to claim the credit. However, certain married taxpayers who live apart from their spouse may qualify to claim the credit while filing separately.
Who Is a Qualifying Person?
Expenses may qualify if care was provided for:
- A dependent child under age 13.
- A spouse who was physically or mentally incapable of self-care and lived with you for more than half of the year.
- Another individual who was physically or mentally incapable of self-care, lived with you for more than half of the year, and met the applicable dependency requirements.
Where Do I Enter Schedule DC Information?
To complete Schedule DC:
State Section > Pennsylvania > Credits > Child and Dependent Care Enhancement Tax Credit (Schedule DC)
You will be prompted to enter information about:
- Care providers.
- Qualifying individuals.
- Qualified care expenses.
What Information Is Needed to Complete Schedule DC?
Care Provider Information
For each care provider, you may need:
- Provider name.
- Address.
- Social Security Number (SSN) or Federal Employer Identification Number (FEIN).
- Amount paid for care.
Qualifying Person Information
For each qualifying individual, you may need:
- Name.
- Date of birth.
- Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).
- Relationship to the taxpayer.
- Qualified care expenses.
How Is the Credit Calculated?
The Pennsylvania Child and Dependent Care Enhancement Tax Credit is based on qualifying child and dependent care expenses claimed for the federal credit.
The credit calculation is subject to:
- Income limitations.
- The number of qualifying individuals.
- Maximum eligible expense amounts.
Qualified expenses are generally limited to:
- Up to $3,000 for one qualifying person.
- Up to $6,000 for two or more qualifying persons.
Because the credit is refundable, eligible taxpayers may receive a refund even if the credit exceeds their Pennsylvania tax liability.
How Does Schedule DC Affect My Return?
The Child and Dependent Care Enhancement Tax Credit may:
- Reduce Pennsylvania tax liability.
- Increase a Pennsylvania refund.
- Provide a refundable credit for eligible child and dependent care expenses.
Important Information
- The expenses claimed on Schedule DC must also be claimed on the federal return.
- A completed Federal Form 2441 and Schedule 3 should be included with the Pennsylvania return.
- Failure to provide required supporting documentation may result in the credit being removed or adjusted during processing.
- Additional review of the credit may delay refund processing.
Additional Information
Review your federal child and dependent care records and any related tax documents before completing Pennsylvania Schedule DC to ensure the information reported is accurate and complete.