Federal Tax Credits & Childcare FSAs (2025 Update)
A tax credit is a valuable tool for families, offering a dollar-for-dollar reduction in the taxes owed. Some credits are even refundable, reducing taxes to zero and providing a refund. The American Rescue Plan Act of 2021 has enhanced the benefits for families with children, specifically for child care. Here's a breakdown:
Child Tax Credit (CTC)
Eligible families can claim up to $2,000 per child, with $1,700 refundable. Learn more at the IRS Child Tax Credit page
Child & Dependent Care Tax Credit
Get back up to 35% of qualifying childcare expenses—up to $3,000 per child or $6,000 per household. Learn more here
Dependent Care FSA (Flexible Spending Account)
In 2025, you can contribute up to $5,000 tax-free through your employer to cover daycare tuition, including at Learning Space Christian Academy.
Earned Income Tax Credit (EITC)
Qualifying families with three or more children could receive up to $7,830. Check eligibility For all credits and deductions, consult a licensed tax professional. You can also check out Nevada’s tax credits for working families.