‘‘(B) care (for not more than 14 days dur-
ing the calendar year) of a qualifying individual
described in subparagraph (A) during any pe-
riod during which the individual does not regu-
larly spend at least 8 hours each day in the tax-
payer’s household.
‘‘(2) DOLLAR LIMIT.—The amount of the res-
pite care expenses incurred during any taxable year
which may be taken into account under subsection
(a) shall not exceed—
‘‘(A) $1,200 if such expenses are incurred
with respect to only 1 qualifying individual for
the taxable year, or
‘‘(B) $2,400 if such expenses are incurred
for 2 or more qualifying individuals for such
taxable year.
‘‘(d) QUALIFYING INDIVIDUAL.—For purposes of this
section, the term ‘qualifying individual’ means—
‘‘(1) a dependent of the taxpayer who is under
the age of 13 and with respect to whom the taxpayer
is entitled to a deduction under section 151(e),
‘‘(2) a dependent of the taxpayer who is phys-
ically or mentally incapable of caring for himself, or
‘‘(3) the spouse of the taxpayer, if he is phys-
ically or mentally incapable of caring for himself.
‘‘(e) SPECIAL RULES.—For purposes of this section:
‘‘(1) MAINTAINING
HOUSEHOLD.—An individ-
ual shall be treated as maintaining a household for
any period only if over half the cost of maintaining
the household for such period is furnished by such
individual (or, if such individual is married during
such period, is furnished by such individual and his
spouse).
‘‘(2) MARRIED COUPLES MUST FILE JOINT RE-
TURN.—If the taxpayer is married at the close of
the taxable year, the credit shall be allowed under
subsection (a) only if the taxpayer and his spouse
file a joint return for the taxable year.
‘‘(3) MARITAL STATUS.—An individual legally
separated from his spouse under a decree of divorce
or of separate maintenance shall not be considered
as married.
‘‘(4) CERTAIN
MARRIED
INDIVIDUALS
LIVING
APART.—If—
‘‘(A) an individual who is married and who
files a separate return—
‘‘(i) maintains as his home a house-
hold which constitutes for more than one-
half of the taxable year the principal place
of abode of a qualifying individual, and
‘‘(ii) furnishes over half the cost of
maintaining such household during the
taxable year, and
‘‘(B) during the last 6 months of such tax-
able year such individual’s spouse is not a mem-
ber of such household,
such individual shall not be considered as married.
‘‘(5) SPECIAL DEPENDENCY TEST IN CASE OF
DIVORCED PARENTS, ETC.—If—
‘‘(A) paragraph (2) or (4) of section
152(e) applies to any child with respect to any
calendar year, and
‘‘(B) such child is under the age of 13 or
is physically or mentally incapable of caring for
himself,
in the case of any taxable year beginning in such
calendar year, such child shall be treated as a quali-
fying individual with respect to the custodial parent
(within the meaning of section 152(e)(1)), and shall
not be treated as a qualifying individual with respect
to the noncustodial parent.
‘‘(6) PAYMENTS TO RELATED INDIVIDUALS.—
No credit shall be allowed under subsection (a) for
any amount paid by the taxpayer to an individual—
‘‘(A) with respect to whom, for the taxable
year, a deduction under section 151(e) (relating
to deduction for personal exemptions for de-
pendents) is allowable either to the taxpayer or
his spouse, or
‘‘(B) who is a child of the taxpayer (within
the meaning of section 151(e)(3)) who has not
attained the age of 19 at the close of the tax-
able year.
For purposes of this paragraph, the term ‘taxable
year’ means the taxable year of the taxpayer in
which the service is performed.
‘‘(7) STUDENT.—The term ‘student’ means an
individual who during each of 5 calendar months
during the taxable year is a full-time student at an
educational organization.
‘‘(8) EDUCATIONAL ORGANIZATION.—The term
‘educational organization’ means an educational or-
ganization described in section 170(b)(1)(A)(ii).
‘‘(9) IDENTIFYING
INFORMATION
REQUIRED
WITH RESPECT TO SERVICE PROVIDER.—No credit
shall be allowed under subsection (a) for any amount
paid to any person unless—
(1) The table of sections for subpart C of part
IV of subchapter A of chapter 1 of such Code is
amended by striking out the item relating to section
35 and inserting in lieu thereof the following:
‘‘Sec. 35. Dependent care services.
‘‘Sec. 36. Overpayments of tax.’’
(2) The table of sections for subpart A of such
part IV is amended by striking out the item relating
to section 21.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1994.
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