There are tax credits and incentives available from both the federal and state government to encourage businesses to invest in child care as an employee benefit. Many of these credits and incentives go unused. Work with your tax advisor to find out how to make these credits work for you.
Federal Employer-Provided Child Care Credit
The federal credit is typically 25% of child care expenses, plus 10% of resource and referral expenses, with the annual maximum of $150,000. Learn more on these web pages:
- Employer-Provided Child Care Credit (IRS)
- Form 8882, Credit for Employer-Provided Child Care Facilities and Services (IRS)
- More information about the Employer-Provided Child Care Credit, Tootris, January 2024
Kansas Child Day Care Assistance Credit
The state credit (schedule K-56) can offset up to $45,000 in year 1 and $30,000 per year after that in facility and equipment costs. Learn more by clicking the link below: