A household is entitled to a dependent care deduction when it is necessary for a household member to accept, continue, or seek employment, to attend training, or to pursue education in preparation for employment. Dependents may be any age and may include household members who are sick or disabled.
Example: A mother is employed full time. She pays someone to care for her 14-year-old daughter while she works. The mother believes that her daughter is not mature enough to be home alone. The CAO may be flexible in determining whether this household needs child care and qualifies for a dependent care deduction.
Example: A father is employed full time. He pays for someone to care for his disabled 21-year old daughter while he works. If he pays for an attendant, homemaker, home health aide, child care service, or housekeeper because of his daughter’s disability, the expense is an allowable medical expense. (See Section 560.42.)
The total deduction is equal to the actual cost of care for each dependent.
Example: A mother is employed full-time and pays child care for two children under age two. The cost of care for the first child is $230, and the cost of care for the second is $180. The allowable deduction is $230 + $180 = $410.
Child care expenses paid by DHS are considered reimbursements and cannot be used as a dependent care deduction for a household. Only the portion of child care expenses incurred by the household and not paid by DHS is deductible.
Expenses are allowable only when paid to a person outside the household.
Example: A mother is employed and pays her 16-year-old daughter, who is a household member, to baby sit for the other children after school. Because the daughter is a household member, the expense is not allowed.
Expenses are not allowed if paid in goods or services (payment-in-kind).
Example: A mother is employed and permits a neighbor to use her garage in payment for baby sitting her children. The mother estimates the garage use to be valued at $150 per month. The expense is not allowed, because the payment is in kind and not cash.
If a school, institution, program, or other grantor earmarks part of educational assistance for dependent care expenses, and this income is excluded for SNAP purposes, it cannot be allowed as a deduction. However, the student could receive a partial dependent care deduction if the student incurs dependent care expenses that exceed the monthly educational assistance earmarked for these expenses.
Example: An educational grant earmarked $2,400 for dependent care expenses over a 10 month period. The student pays $220 per month for child care. The student is not eligible for a dependent care deduction. The total amount of $240 per month earmarked for dependent care expenses exceeds the actual dependent care expenses.
Example: An educational grant earmarked $1,500 for dependent care expenses over ten months. The student pays $200 per month for child care. The student is eligible for a $50 dependant care deduction. The total amount of $150 per month earmarked for dependent care expenses does not exceed the actual dependent care expense of $200 a month. The student is eligible for a $50 deduction ($200 - $150 = $50).
If a household is entitled to a dependent care deduction, the CAO worker must enter into the Client Information System (CIS) the actual out of pocket, non-reimbursed cost per dependent for dependent care.
The case narrative must discuss the basis for the dependent care expense allowed for the household.
At application the CAO must verify dependent care costs if the household has:
Provided information that is questionable.
To be considered questionable:
Information on the application must be inconsistent with other information on the application or previous applications.
Information is inconsistent with information received by the CAO, known in the case record, presented during the interview, or provided from other sources such as Pelican, for dependent care expenses.
Verification should be requested when information provided by the applicant is incomplete, unclear, or contradictory. When determining if information is questionable, the decision shall be based on each household’s individual circumstances.
Determination of questionable information shall not be based on race, religion, ethnic background, or national origin. CAOs should not target groups such as migrant farmworkers or American Indians for more intensive verification under this provision. The rationale for determining information questionable should be entered in the narrative.
If an applicant/recipient is receiving subsidized childcare, dependent care expenses can be verified through Pelican.
Example: Ms. Wall applies for SNAP benefits for herself and two children. Ms. Wall and her children are not known to the system as they have never received benefits. Ms. Wall states she pays for dependent care expenses for her two children. Her dependent care expenses are reasonable based on her income. No verification should be requested since the information Ms. Wall provided is NOT questionable.
At SAR review, at renewal or during the certification period, the CAO must verify dependent costs if:
Information is questionable or inconsistent.
Acceptable verification includes, but is not limited to, bills or statements from the provider stating the cost, nature, and period of time care was provided.
7 CFR § 273.2(f)(2)(i)
7 CFR § 273.2(f)(3)
7 CFR § 273.2(f)(6)
7 CFR § 273.9(d)(4)
7 CFR § 273.10(d)(1)
7 CFR § 273.10(d)(1)(ii)
7 CFR § 273.21(j)
Pub. L. 110-246
Reissued September 10, 2015 , replacing March 1, 2012