To amend the Internal Revenue Code of 1986 to provide a credit for increasing wages paid to child care providers.
Sponsored By: Representative Sánchez, Linda T. [D-CA-38]
Introduced
Summary
Child Care Supply Credit would create a new tax credit to push employers to raise wages for qualified child care workers. It links the credit to year‑over‑year wage growth and favors rural facilities.
Show full summary
- Employers: Employers could claim a new general business tax credit equal to the lesser of 5 percent of qualified child care wages or the amount wages rose over the prior year. The credit is added to the general business credit and follows existing election and anti‑double‑benefit rules.
- Child care workers: The credit only applies when an employer’s average hourly child care wage increases year over year, creating a direct incentive to raise pay for qualifying staff.
- Eligible facilities and rural boost: Workers must be at facilities that care for at least six children, receive fees or grants, and follow state or local rules. Facilities in rural areas get a higher 7 percent rate instead of 5 percent.
Personalized for You
How does this bill affect your finances?
Personalize government policy and PRIA will tell you what this bill means for your household, plus every other piece of legislation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.
Bill Overview
Analyzed Economic Effects
1 provisions identified: 1 benefits, 0 costs, 0 mixed.
Tax credit for child care wages
This bill would create a Child Care Supply Credit for employers who raise wages for child care workers. The credit would equal the lesser of: the applicable percentage of qualified child care wages (5% generally, 7% for a facility in a rural area) or the dollar increase in those wages over the prior year. An employer would only be able to claim the credit if its average hourly child care wage this year is higher than in the prior year. An eligible child care facility would need to serve at least six children, receive a fee, payment, or grant, and comply with state or local laws. The bill would add the credit to the general business credit, prevent double benefits with other credits, allow employers to elect not to apply the credit for a year, and apply to taxable years beginning after enactment.
Sponsors & CoSponsors
Sponsor
Sánchez, Linda T. [D-CA-38]
CA • D
Cosponsors
Rep. Miller, Carol D. [R-WV-1]
WV • R
Sponsored 3/19/2026
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov