At some point in our lives, we will all need to care for ourselves or a loved one. People need care supports — child care, paid family and medical leave, aging and disability care, for example — to be able to participate in the workforce and for their own well-being as well as that of their families. Unfortunately, policymakers in the United States have not made the policy changes and systemic investments that help people balance caring for themselves and their families and working for pay.

Our tax code is no exception. One purpose of our tax system is to collect revenue and invest in our shared priorities, like care. Today’s federal tax code, however, fails to collect sufficient revenue for these priorities, largely because of decades of tax cuts for the wealthiest individuals and big corporations. This has enabled some policymakers to argue that, as a nation, “we can’t afford” public investments, including in care. In the current Congress, lawmakers are advancing legislation that would explicitly take away supports for struggling families to pay for tax cuts that would primarily benefit the wealthy. The tax code also fails to meaningfully support care with its existing provisions related to child care, paid family and medical leave, and aging and disability care. The failure of the tax code to support caregivers and families that need care entrenches the flawed assumption that care is only an individual’s family responsibility rather than the backbone of our communities and broader economy.

In this report, originally published in Tax Notes in March 2025, we argue that the 2025 tax law changes can either mitigate or exacerbate the care crisis faced by millions of families across the country. Lawmakers have a clear choice before them: Prioritize more tax breaks for billionaires and corporations at the expense of families, or change our tax policies so the tax system supports everyday families, including with care investments. To meaningfully support caregivers and families, it is imperative that the tax code raise sufficient revenue to support public investments in care and expand certain tax benefits for low- and moderate-income families.