This bill introduces tax credits against the business profits tax for businesses that provide on-site child care services and for those that offer health care coverage to certain employees. Specifically, it allows an on-site child care services tax credit equal to 20% of qualifying expenditures, capped at $100,000 per fiscal year, for eligible businesses that operate or contract for child care services within specified proximity to their main facilities. Additionally, a "parent hours" tax credit is established, providing a 20% credit on health care benefits for employees with dependent children who work limited hours during weekdays. The bill also stipulates that unused tax credits can be carried forward for up to four years and outlines conditions under which businesses must repay credits if they close their child care facilities within three years of receiving the credit.

Furthermore, the bill appropriates $40,000 to the Department of Revenue Administration for necessary improvements and upgrades to the revenue information management system to facilitate the implementation of these tax credits. The aggregate amount of on-site child care services tax credits issued is limited to $2,500,000 per fiscal year, and the bill mandates that applications for these credits be processed within 60 days. The provisions of this act will apply to taxable periods beginning on or after December 31, 2027, with an effective date of July 1, 2027.

Statutes affected:
Introduced: 77-A:5
As Amended by the Senate: 77-A:5