Mr. and Mrs. Coulter have four dependent children, ages 1, 4, 7, and 11. Mr. Coulter’s salary was $21,400, Mrs. Coulter’s wages totaled $16,200, and the couple had no other income or above-the-line deductions this year. The Coulters paid $3,600 for day care and after-school child care.
a. Compute the Coulters’ child credit.
b. Compute the Coulters’ dependent care credit.
c. Re-compute the Coulters’ child and dependent care credits if Mr. Coulter’s salary was $100,000, Mrs. Coulter’s wages totaled $32,000, and the couple earned $5,700 taxable interest income.