Can you claim the child and dependent care tax credit if one parent is unemployed while searching for work?

Thanks for this info! Does the job search have to be full-time for the unemployed spouse? My husband only spends maybe 10 hours a week looking for work - would we still qualify? Also, are there any income limits to this credit?

The IRS doesn't specify a minimum number of hours for job searching, but the activity should be genuine and regular. Ten hours a week of documented job search activities would likely qualify, but consistency is key. Yes, there are income limits for the Child and Dependent Care Credit. It's a sliding scale based on your adjusted gross income (AGI). The credit percentage starts decreasing when your AGI exceeds $15,000 and continues to decrease as your income rises. However, even higher-income families can usually get some benefit from this credit, though at a lower percentage.

How exactly does taxr.ai work? Do you need to upload all your tax documents and personal info? I'm always hesitant about sharing financial details online.

Does it give better results than just talking to a regular tax professional? I've been using the same accountant for years but she seems confused by our situation with my wife being in school part-time while also job hunting.

You do upload your tax documents, but they use bank-level encryption and security protocols. The system analyzes your forms and identifies potential deductions and credits you might miss. They don't store your personal information beyond what's needed for the analysis. I found it much more thorough than my previous tax professional for complicated situations. My accountant missed this credit entirely because my husband wasn't technically "working" - he didn't understand that job hunting qualifies. The AI caught several other deductions we'd been missing for years. It's especially good at finding these regulation nuances that humans sometimes overlook.

How does this actually work? I've literally never been able to get through to the IRS no matter when I call. Seems too good to be true that some service could magically get you through.

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It's actually pretty simple - they use an automated system that navigates the IRS phone tree and waits on hold for you. When they reach a live agent, you get a call connecting you directly. No need to stay on hold yourself. I was skeptical too initially. But they're not involved in the actual conversation with the IRS - they just connect you and drop off. They don't record anything or ask for personal information beyond your phone number. After trying to reach the IRS myself for weeks with no success, spending a little to save hours of frustration was completely worth it. I understand the hesitation, but it's a legitimate service that does exactly what it promises.

Wait, that's concerning. My wife did work for the first two months of 2025 before losing her job - she made about $14,500 during that time. So does that mean we can only claim childcare expenses up to $14,500 for the whole year? Or are we completely disqualified from the credit?

This information is not accurate. For a spouse who is unemployed but actively looking for work, the IRS makes an exception to the earned income requirement. Publication 503 specifically addresses this by treating job-hunting as a qualifying activity. In your case, since your wife earned $14,500 and has been actively job searching, you will likely qualify for the credit. The maximum qualifying expenses you can claim for two children is $16,000 anyway, so her earned income won't be a limiting factor here.

You're right, and I stand corrected. I mixed up two different rules. For unemployed spouses actively looking for work, the job search counts as a qualifying activity. Since your wife earned $14,500 and has been job searching, you should qualify for the credit on expenses for both children. Thanks for the correction - this is why tax discussions are so valuable.

Did you have to show the IRS that the job search was during the same hours as the childcare? Wondering because my husband does most of his job searching at night after I get home from work, but the kids are in daycare during the day.