Where Trump and Clinton Stand on Tax Breaks for Dependent Care

Health Care & Insurance

Where Trump and Clinton Stand on Tax Breaks for Dependent Care

Trump unveils a new tax deduction for families with up to 4 children or providing elderly care. Clinton wants a 10% household income cap on child care expenses.


GOP presidential candidate Donald Trump has proposed revising and expanding tax breaks designed to reduce the cost of child care and elderly dependent care.

See Also: Where Clinton and Trump Stand on Obamacare

On Sept. 13, the Trump campaign announced a plan to allow families to deduct child-care expenses, up to the average cost of child care in their state. Parents who itemize as well as those who claim the standard deduction would be able to claim this tax break.

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There are income caps for the wealthy. Couples with income of more than $500,000 and individuals with income exceeding $250,000 would be ineligible. Families could claim the tax break for up to four children; it would also be available for taxpayers with elderly dependents.


Trump also wants to create a new savings plan that would allow parents to make tax deductible contributions to an account to pay for child care, after-school programs and private school tuition. Accounts set up for elderly dependents could be used for in-home nursing care, long-term care and other services.

Under current law, flexible spending accounts allow parents to put aside pre-tax money for child care, but these accounts are only offered through employers and qualified expenses are more limited than those permitted by Trump's plan.

In addition, money saved in FSAs must be used by year-end (or the following first quarter). Trump's plan would allow savers to carry over unused balances.

Trump would also allow caregivers to claim an above-the-line deduction of up to $5,000 to cover home health care, adult day care or similar services for an elderly family member.


Clinton has proposed capping child care costs at 10% of a family's income. The program would involve federal subsidies for low-income families and tax breaks for middle-income parents. (Clinton hasn't provided specifics on how this tax relief would work.) Clinton also wants to provide financial aid to the nearly 5 million college students who are raising children while attending school. Clinton wants to provide those students with scholarships of up to $1,500, which could be used for child care, transportation or emergency financial aid.

Trump has proposed guaranteeing six weeks of maternity leave to mothers who don't already receive paid leave from their employers. His plan, which he says would be paid for by eliminating fraud in the unemployment insurance program, would be limited to mothers.

Clinton wants to provide up to 12 weeks of guaranteed leave for workers who need to take time off to care for a new child or seriously ill family member. Under her plan, workers would receive up to two-thirds of their current wages, up to a ceiling, while on leave. She would increase taxes on the wealthiest taxpayers to cover the costs of the program.

See Also: Where Clinton and Trump Stand on 9 Money Issues