Child and dependent care expenses can take a huge bite out of families’ budgets. With few increases in state or federal funding, direct child care assistance is not available to every family that needs help paying for child and dependent care.
The federal Child and Dependent Care Tax Credit and similar state tax provisions can help eligible families offset their child care expenses. These tax provisions can lower the income taxes that families must pay and, in some cases, give cash refunds to families whose incomes are too low to owe taxes.
Twenty-six states (including the District of Columbia) have child and dependent care tax provisions, most of which are based in some way on the federal credit. Twelve of those states offer refundable credits (listed in bold).
|
State Tax Provisions |
Maximum Value |
|
Arkansas Child Care Tax Credit |
$420 |
|
Arkansas Early Childhood Program Tax Credit |
$420 |
|
California Tax Credit for Child and Dependent Care Expenses |
$1,050 |
|
Colorado Child Care Tax Credit |
$1,050 |
| Colorado Low-Income Child Care Expenses Credit |
$1,000 |
|
Delaware Child Care Tax Credit |
$1,050 |
|
The District of Columbia Tax Credit for Child and Dependent Care Expenses |
$672 |
|
Georgia Tax Credit for Child and Dependent Care Expenses |
$630 |
|
Hawaii Tax Credit for Child and Dependent Care Expenses |
$1,200 |
|
Idaho Tax Deduction for Child and Dependent Care Expenses |
$444 |
|
Iowa Child and Dependent Care Tax Credit |
$1,575 |
|
Kentucky Child and Dependent Care Tax Credit |
$420 |
|
Louisiana Child Care Tax Credit |
$1,050 |
|
Louisiana Child Care Expense Tax Credit |
$2,100 |
|
Louisiana Tax Credit for Certain Disabled Dependents |
$2,100 |
|
Maine Child Care Tax Credit |
$1,050 |
|
Maryland Tax Credit for Child and Dependent Care Expenses |
$683 |
|
Maryland Tax Deduction for Child and Dependent Care Expenses |
$345 |
|
Massachusetts Tax Deduction for Child and Dependent Care Expenses |
$562 |
|
Minnesota Child and Dependent Care Tax Credit |
$1,440 |
|
Montana Child and Dependent Care Expense Tax Deduction |
$192 |
|
Nebraska Tax Credit for Child and Dependent Care Expenses |
$2,100 |
|
New Mexico Child Day Care Tax Credit |
$960 for two, $1,200 for three or more children or dependents |
|
New York State Child and Dependent Care Tax Credit |
$2,310 |
|
Ohio Tax Credit for Child and Dependent Care Services |
$2,100 |
|
Oklahoma Child Care Tax Credit |
$420 |
|
Oregon Working Families Child and Dependent Credit |
$18,000 |
|
Rhode Island Tax Credit for Child and Dependent Care Expenses |
$525 |
|
South Carolina Tax Credit for Child and Dependent Care Expenses |
$420 |
|
Vermont Tax Credit for Child and Dependent Care Expenses |
$504 |
|
Vermont Low-Income Child and Dependent Care Tax Credit |
$1,050 |
|
Virginia Tax Deduction for Child and Dependent Care Expenses |
$345 |
For more information about state child and dependent care tax provisions, see NWLC’s report, Making Care Less Taxing. If you are interested in introducing or improving a child and dependent care tax provision in your state, or the federal Child and Dependent Care Tax Credit on which many state credits are based, contact Sarah Hassmer at [email protected].