Bill > S847

This bill aims to enhance child care support for working families through several key tax provisions. First, it expands the employer-provided child care credit by increasing the percentage of qualified child care expenditures from 25% to 50%, and raising the maximum credit amount from $150,000 to $500,000. The bill also creates a special provision for small businesses, allowing them an even more generous 60% credit with a higher $600,000 maximum. Additionally, the legislation increases the amount excludable for dependent care assistance programs from $5,000 to $7,500, and creates a new refundable tax credit for household and dependent care expenses. This new credit would allow taxpayers to claim up to 50% of their employment-related child care expenses, with the percentage gradually reducing based on income levels. The credit would apply to care for children under 13, dependents who are physically or mentally incapable of self-care, and spouses meeting similar criteria. The bill sets maximum creditable expenses at $5,000 for one qualifying individual and $8,000 for two or more, and includes various rules about qualifying expenses, income limitations, and documentation requirements. These changes are designed to make child care more affordable and accessible for working families across different income levels.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/847/all-info