Bill > A1602

Introduced Session

This bill allows taxpayers a gross income tax credit for a portion of child care expenses of children enrolled at a licensed child care center. The credit amount varies depending on the Grow NJ Kids rating of the child care center. If the center has a three star rating, the credit allowed is equal to 15 percent of expenses paid to the center; if the center has a four star rating, the credit allowed is equal to 17.5 percent of expenses; if the center has a five star rating, the credit allowed is equal to 20 percent of expenses. Grow NJ Kids is a State-sponsored initiative that provides a rating and improvement system designed to assess child care and education programs. A taxpayer may claim a credit for each child less than six years old that is enrolled at a licensed child care center. The child is considered less than six years old if the child is less than six years old at any point during the calendar year. For taxpayers with less than $25,000 of gross income, the credit is refundable. Effectively, if the taxpayer has no tax liability to use the whole or part of the credit against, the taxpayer would receive the remaining credit amount from the State in cash. For taxpayers with higher income, any remaining credit may be carried forward to the next taxable year, but may not be carried forward beyond that. The credit allowed by this bill cannot be claimed in the same year as New Jersey's child and dependent care credit. That credit, first allowed for taxable year 2018, is equal to a percentage of the federal income tax credit that the taxpayer is allowed for child and dependent care.

AI Summary

Committee Categories

Andrea Katz (D)*, 

Introduced, Referred to Assembly Children, Families and Food Security Committee (on 01/09/2024)

Official Document