graph (1), such spouse shall be deemed for each 
month during which such spouse is a full-time stu-
dent at an educational institution, or is an individual 
so described in subsection (e)(1)(B)(ii)(III), to be 
gainfully employed and to have earned income of not 
less than— 
‘‘(A) $250 if there is 1 individual described 
in subclauses (I) through (III) of subsection 
(e)(1)(B) with respect to the taxpayer for the 
taxable year, or 
‘‘(B) $500 if there are 2 or more such in-
dividuals with respect to the taxpayer for the 
taxable year. 
In the case of any husband and wife, this paragraph 
shall apply with respect to only one spouse for any 
month.’’. 
(5) Section 129(e)(1) of such Code is amend-
ed— 
(A) by striking ‘‘The term’’ and inserting 
the following: 
‘‘(A) IN GENERAL.—The term’’, 
(B) by striking ‘‘under section 21(b)(2) 
(relating to expenses for household and depend-
ent care services necessary for gainful employ-
ment)’’, and 
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(C) by adding at the end the following: 
‘‘(B) 
EMPLOYMENT-RELATED
EX-
PENSES.— 
‘‘(i) IN GENERAL.—The term ‘employ-
ment-related expenses’ means amounts 
paid for the following expenses, but only if 
such expenses are incurred to enable the 
taxpayer to be gainfully employed for any 
period for which there are 1 or more quali-
fying individuals with respect to the tax-
payer: 
‘‘(I) Expenses for household serv-
ices, and 
‘‘(II) Expenses for the care of a 
qualifying individual. 
Such term shall not include any amount 
paid for services outside the taxpayer’s 
household at a camp where the qualifying 
individual stays overnight. 
‘‘(ii) 
EXCEPTION.—Employment-re-
lated expenses described in clause (i) which 
are incurred for services outside the tax-
payer’s household shall be taken into ac-
count only if incurred for the care of— 
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‘‘(I) a dependent of the taxpayer 
(as defined in section 152(a)(1)) who 
has not attained age 13, 
‘‘(II) a dependent of the taxpayer 
(as defined in section 152, determined 
without regard to subsections (b)(1), 
(b)(2), and (d)(1)(B)) who is phys-
ically or mentally incapable of caring 
for himself or herself, who has the 
same principal place of abode as the 
taxpayer for more than one-half of 
such taxable year, and who regularly 
spends at least 8 hours each day in 
the taxpayer’s household, or 
‘‘(III) the spouse of the taxpayer, 
if the spouse is physically or mentally 
incapable of caring for himself or her-
self, has the same principal place of 
abode as the taxpayer for more than 
one-half of such taxable year, and reg-
ularly spends at least 8 hours each 
day in the taxpayer’s household. 
‘‘(iii) DEPENDENT CARE CENTERS.— 
Employment-related expenses described in 
clause (i) which are incurred for services 
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provided outside the taxpayer’s household 
by a dependent care center shall be taken 
into account only if— 
‘‘(I) such center complies with all 
applicable laws and regulations of a 
State or unit of local government, and 
‘‘(II) The requirements of clause 
(ii) are met. 
‘‘(iv) DEPENDENT CARE CENTER DE-
FINED.—For purposes of this paragraph, 
the term ‘dependent care center’ means 
any facility which— 
‘‘(I) provides care for more than 
six individuals (other than individuals 
who reside at the facility), and 
‘‘(II) receives a fee, payment, or 
grant for providing services for any of 
the individuals (regardless of whether 
such facility is operated for profit).’’. 
(6) Section 213 of such Code is amended by 
striking subsection (e). 
(7) Section 6213(g)(2) of such Code is amend-
ed— 
(A) in subparagraph (H), by striking ‘‘sec-
tion 21 (relating to expenses for household and 
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dependent care services necessary for gainful 
employment) or’’, and 
(B) in subparagraph (L), by striking 
‘‘21,’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
Æ 
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