Establishes a refundable credit for qualified child care startup expenses.
The credit amount is up to $5,000 for qualified taxpayers.
Defines a qualified taxpayer as one who operates a qualified family child care provider.
Specifies that a qualified family child care provider must:
Provide child care services for compensation that is licensed or registered under state law.
Primarily provide child care at the taxpayer’s primary residence.
Provide child care services to not less than 2 children (excluding the taxpayer’s children) for a significant portion of the taxable year.
Qualified child care startup expenses include:
Licensing fees, supplies (diapers, food, toys, learning materials), liability insurance, fencing and its installation, outdoor playground equipment and its installation, necessary furniture, employee salaries (excluding the taxpayer), printers and computers, professional training for state licensure, and remediation or renovation of the residence for licensure.
Limits the credit to one-time use per taxpayer and denies the credit for expenses that are eligible for deductions or credits under other provisions.
Requires the Secretary to issue regulations or guidance as necessary, including information reporting and coordination with state and local licensing entities.
Includes a sunset provision that ends the credit 7 years after enactment.
Makes conforming amendments to related sections of the Internal Revenue Code and United States Code.