Childcare Cost Calculator

How much does childcare cost in 2026?

Figures are from the Care.com 2026 Cost of Care Report. Local prices vary a lot – city centres and high-cost states can be far above the national average, while rural areas and home-based daycares are often cheaper. Your state's child care resource and referral agency (listed by Child Care Aware of America) can give local price data.

Cost by age

Infant care is the most expensive because staff-to-child ratios are lowest – often one adult for three or four babies – so labour costs more per child. Prices usually fall for toddlers and preschoolers, and before- and after-school care for school-age children costs much less again because it covers fewer hours.

How much should you budget?

The US Department of Health and Human Services uses 7% of household income as its benchmark for affordable childcare, but many families pay much more. A practical approach: get quotes, enter them here, then compare the net cost with your monthly take-home pay alongside rent, food and transport.

Daycare vs nanny vs babysitter

With one infant, daycare at about $1,439 a month is far cheaper than a nanny at about $3,770. With two young children in daycare the bill roughly doubles, which narrows the gap – and with three it can tip in the nanny's favour, especially once you add the convenience of care at home.

Nanny employer costs

If you pay a nanny above the IRS household-employee threshold for the year, you generally must withhold and pay Social Security and Medicare (7.65% employer share), may owe federal unemployment tax, and must give a Form W-2. IRS Publication 926 has the current thresholds; payroll services for household employers can handle this for a fee.

2026 tax savings: dependent care FSA and tax credit

A dependent care FSA (dependent care assistance program) lets you pay for eligible childcare with pre-tax wages through your employer. From 2026 the limit is $7,500 per household ($3,750 if married filing separately), up from $5,000.

The child and dependent care tax credit is a federal credit for care costs that let you work or look for work, for children under 13. You can count up to $3,000 of expenses for one child or $6,000 for two or more. From 2026 the credit rate starts at 50% for the lowest incomes, phases down to 35% for most middle-income families, and phases down further to 20% at higher incomes (above $75,000 AGI, or $150,000 on a joint return).

You cannot use the same dollars twice

Money paid through a dependent care FSA reduces the expenses you can claim for the credit. Example: married couple, two children, $20,000 of daycare, AGI $120,000. Without an FSA, the credit is 35% × $6,000 = $2,100. With a $7,500 FSA, the credit's $6,000 limit is fully used up, so the credit is $0 – but the FSA saves about $2,224 at a 22% federal bracket plus 7.65% payroll tax, before any state tax saving. For this family the FSA is worth slightly more; at lower incomes the 50% credit can be worth more. The calculator compares both.

Ways to lower childcare costs

• Ask about sibling discounts – many centres offer 5–10% off for a second child.
• Use your employer's dependent care FSA and check whether they offer backup care or subsidies.
• Check state childcare assistance programmes and Head Start or state pre-K eligibility.
• Consider a nanny share with another family, or part-time care combined with flexible work.
• Compare home-based licensed daycares, which often charge less than centres.

Sources

1. Care.com – 2026 Cost of Care Report — care.com/c/how-much-does-child-care-cost
2. IRS Publication 503 – Child and Dependent Care Expenses; Form 2441 — irs.gov
3. IRS Publication 926 – Household Employer's Tax Guide — irs.gov
4. One Big Beautiful Bill Act (P.L. 119-21) §§70404–70405 – dependent care changes, summarised by NATP — natptax.com
5. HHS – Child Care and Development Fund final rule (7% affordability benchmark) — acf.hhs.gov