What is the average cost of full-time daycare in the United States?

In 2026, the national average for full-time center-based infant care is approximately $1,300–$1,600 per month. Costs vary dramatically by state — from around $700/month in Mississippi to over $2,400/month in Massachusetts and Washington D.C. Toddler and preschool care generally runs 10–20% less than infant care.

Is daycare tax deductible?

Daycare expenses are eligible for the Child and Dependent Care Tax Credit, which covers 20–35% of qualifying expenses up to $3,000 for one child or $6,000 for two or more children. If your employer offers a Dependent Care FSA, you can pay up to $5,000 in pre-tax dollars toward daycare costs, which is typically more valuable than the tax credit for higher earners.

How can I reduce my daycare costs?

The most impactful strategies are: (1) Use a Dependent Care FSA to pay with pre-tax dollars, saving 22–32% depending on your tax bracket. (2) Apply for state childcare subsidy programs — eligibility thresholds are higher than many parents expect. (3) Consider a part-time schedule if your work situation allows. (4) Look for employer childcare benefits, which some large employers now offer.

Daycare Cost Guide 2026: What to Expect and How to Afford It

May 14, 2026

Average Daycare Costs by Age Group (2026)

Infant care is almost always the most expensive category because infant-to-caregiver ratios are the lowest — centers must hire more staff per child for children under 12 months. Costs decrease as children get older and ratios improve.

Infants (0–12 months): $1,100–$2,500/month nationally; average $1,450/month
Toddlers (1–2 years): $950–$2,100/month; average $1,250/month
Preschool (3–5 years): $800–$1,800/month; average $1,050/month
School-age after-care: $400–$900/month; average $580/month

Cost by Region

Where you live matters more than almost any other factor. The highest-cost states for childcare are Massachusetts, Washington D.C., California, New York, and Washington State — where full-time infant care regularly exceeds $2,000/month. The most affordable states include Mississippi, Alabama, South Carolina, and Arkansas, where the same care runs $700–$900/month. Browse daycares by city to understand costs in your specific market.

Center-Based vs. Home-Based Cost Comparison

Family daycares (home-based) typically cost 15–25% less than licensed daycare centers. The tradeoff is group size (usually capped at 6–8 children) and, often, less structured curriculum. For families prioritizing lower ratios and lower cost, a licensed family daycare is worth evaluating alongside centers.

How to Pay Less: Tax Strategies

Dependent Care FSA

If your employer offers a Dependent Care Flexible Spending Account, contribute the maximum $5,000 annually. At a 22% federal tax bracket, this saves $1,100 per year. At 32%, you save $1,600. The FSA is use-it-or-lose-it, so set the contribution amount carefully.

Child and Dependent Care Tax Credit

Even without an FSA, you can claim the Child and Dependent Care Credit on your federal return. For 2026, this covers 20–35% of up to $3,000 in qualifying expenses for one child (or $6,000 for two or more). If you used an FSA, you can only claim the credit on expenses above the FSA amount.

Childcare Subsidy Programs

The Child Care and Development Fund (CCDF) provides federal childcare subsidies administered by states under various names — CCAP, CCA, Child Care Assistance. Eligibility income thresholds vary by state but often reach 85% of state median income. Many eligible families never apply because they assume they don't qualify. Contact your state's childcare agency to check current income thresholds — it's worth a 15-minute phone call.

Employer Childcare Benefits

A growing number of large employers offer childcare benefits beyond FSAs — backup care reimbursement through providers like Bright Horizons, childcare center partnerships with discounts, and in rare cases on-site childcare. Check your employee benefits portal and HR department before assuming you have no employer-side options.

Frequently Asked Questions

What is the average cost of full-time daycare in the United States?: In 2026, the national average for full-time center-based infant care is approximately $1,300–$1,600 per month. Costs vary dramatically by state — from around $700/month in Mississippi to over $2,400/month in Massachusetts and Washington D.C. Toddler and preschool care generally runs 10–20% less than infant care.
Is daycare tax deductible?: Daycare expenses are eligible for the Child and Dependent Care Tax Credit, which covers 20–35% of qualifying expenses up to $3,000 for one child or $6,000 for two or more children. If your employer offers a Dependent Care FSA, you can pay up to $5,000 in pre-tax dollars toward daycare costs, which is typically more valuable than the tax credit for higher earners.
How can I reduce my daycare costs?: The most impactful strategies are: (1) Use a Dependent Care FSA to pay with pre-tax dollars, saving 22–32% depending on your tax bracket. (2) Apply for state childcare subsidy programs — eligibility thresholds are higher than many parents expect. (3) Consider a part-time schedule if your work situation allows. (4) Look for employer childcare benefits, which some large employers now offer.