Bill > HB1412

This bill reinstates and expands tax credits for businesses investing in child day-care, effective January 1, 2027. It reintroduces a tax credit for establishing a child day-care facility, increasing the maximum credit a taxpayer can claim from $25,000 to $50,000 annually. Additionally, it introduces a new nonrefundable income tax credit for businesses that pay or reimburse their employees for eligible child day-care expenses, allowing them to claim 25% of these costs, also capped at $50,000 per taxpayer. The bill defines "child day-care facility" as a licensed program and "eligible child day-care expenses" as costs for services provided to dependents of a taxpayer's employees. A significant change is the increase in the annual cap on total approved credits across all taxpayers from $100,000 to $5 million, though approvals will still be granted on a first-come, first-served basis. The bill also clarifies that taxpayers cannot claim both types of credits in the same year and allows unused credits to be carried over for three years, provided the facility operates for at least six months annually. Finally, it directs the Tax Commissioner to create guidelines for these credits, which will be exempt from the Administrative Process Act, a set of rules governing how state agencies develop and implement regulations.

Budget and Finance

https://lis.virginia.gov/bill-details/20261/HB1412