Child Care Availability and Affordability Act
Sponsored By: Representative Carbajal
Introduced
Summary
This bill would create expanded tax subsidies for child and dependent care. It would enlarge the employer-provided child care tax credit and the dependent care assistance exclusion and add a new refundable household and dependent care credit to help cover care costs tied to working.
Show full summary
- Families and parents: Low- and middle-income households would get more help paying for child and dependent care through a new refundable credit and larger tax breaks.
- Employers: The employer-provided child care credit would be increased and the dependent care assistance exclusion would be broadened, giving businesses stronger incentives to offer or subsidize care.
- Tax code changes: The measure would add a new Section 36C and modify Sections 45F and 129 of the Internal Revenue Code, plus make conforming cross-reference updates and set effective dates.
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 2 benefits, 0 costs, 1 mixed.
Higher tax-free dependent care at work
If enacted, you could exclude more employer-provided dependent care from income. The cap would rise to $7,500 a year, or $3,750 if married filing separately. This would apply to amounts paid or incurred after enactment.
Bigger employer child care tax credit
If enacted, your business could claim a larger credit for child care support. The base credit would rise to 50%, with a $500,000 annual cap. Qualifying small businesses could get 60% with a $600,000 cap. A facility would still qualify even if jointly owned or operated. These changes would apply to amounts paid or incurred after enactment.
New refundable care credit replaces old one
This bill would repeal the old dependent care credit and create a new refundable one. It would help with work-related care for a child under 13 or a spouse/dependent who cannot self-care; outside-the-home care would count only for a child under 13 or for someone who spends at least 8 hours a day in your home, and overnight camps would not count. You could claim up to $5,000 of costs for one person or $8,000 for two or more; the rate would start at 50% and drop 1 point per $2,000 of income over $15,000 (not below 35% until $150,000), then keep dropping above $150,000. If married, you would need to file jointly, and the credit would be limited by earned income (with deemed monthly income for a student or incapable spouse). You would need provider details and each person’s tax ID; payments to certain relatives would not count. It would start for tax years beginning after enactment.
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Sponsors & CoSponsors
Sponsor
Carbajal
CA • D
Cosponsors
Lawler
NY • R
Sponsored 3/4/2025
Davids (KS)
KS • D
Sponsored 3/4/2025
Ciscomani
AZ • R
Sponsored 3/4/2025
Neguse
CO • D
Sponsored 4/1/2025
Landsman
OH • D
Sponsored 4/1/2025
Harder (CA)
CA • D
Sponsored 4/7/2025
Costa
CA • D
Sponsored 4/7/2025
Nunn (IA)
IA • R
Sponsored 4/21/2025
Bacon
NE • R
Sponsored 4/30/2025
Houlahan
PA • D
Sponsored 4/30/2025
Perez
WA • D
Sponsored 4/30/2025
Valadao
CA • R
Sponsored 5/5/2025
Mrvan
IN • D
Sponsored 5/14/2025
Fitzpatrick
PA • R
Sponsored 6/3/2025
Sykes
OH • D
Sponsored 6/25/2025
Gottheimer
NJ • D
Sponsored 7/16/2025
Subramanyam
VA • D
Sponsored 7/16/2025
Davis (NC)
NC • D
Sponsored 7/21/2025
Cuellar
TX • D
Sponsored 8/5/2025
Bynum
OR • D
Sponsored 8/19/2025
Vargas
CA • D
Sponsored 9/16/2025
Whitesides
CA • D
Sponsored 11/25/2025
Edwards
NC • R
Sponsored 12/2/2025
Bresnahan
PA • R
Sponsored 12/18/2025
Vindman
VA • D
Sponsored 4/14/2026
Roll Call Votes
No roll call votes available for this bill.
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