What is the maximum percentage of qualified expenses a taxpayer can claim under the Child and Dependent Care Credit?

The correct choice indicates that the maximum percentage of qualified expenses a taxpayer can claim under the Child and Dependent Care Credit is between 20% to 35%. This tax credit is designed to help taxpayers offset the costs of child care for dependents while they work or look for work.

The percentage of eligible expenses that can be claimed is based on the taxpayer's income. For lower-income taxpayers, the maximum percentage is higher, at 35%. As income increases, the percentage decreases progressively to a minimum of 20% for higher-income taxpayers. This tiered system ensures that the credit provides more assistance to those who may need it most.

Understanding these percentages is crucial because the credit amount directly affects how much of the child and dependent care expenses a taxpayer can use to reduce their overall tax liability.