Child Care Expenses Hurting Your Pockets? Stephanie Murphy Aims to Help
Child care expenses are most definitely a bipartisan issue, particularly when it comes to working-class families. Congresswoman Stephanie Murphy (D-FL) is hoping to provide some relief, and she crossed the aisle for the effort. She and Congressman Jason Smith (R-MO) last week introduced the Promoting Affordable Childcare for Everyone Act (PACE Act), which she says would modernize the Children Dependent Care Tax Credit (CDCTC) -- a non-refundable tax credit that reduces taxpayers' income liability based on expenses incurred on child or dependent care. Aside from making the CDCTC refundable, the legislation would qualify child care expenses that include payments to nannies, housekeepers, and relatives, as well as day care facilities, preschools and day camps. Under the PACE Act, a taxpayer with annual income of $30,000, two children and $6,000 in child care expenses would receive a credit of $2,520. Current law grants the same taxpayer just $1,620. The measure would also adjust the CDCTC income levels and maximum credit amounts for inflation -- $3,000 for a taxpayer with one child and $6,000 for a taxpayer with two or more children. It would also increase the maximum amount of the income exclusion for employer-sponsored child and dependent care to $7,500, up from $5,000 under current law. “For far too long, working families have struggled with the rising costs of child care. Our tax code should reflect our priorities, and one of our top priorities must be our children,” said Murphy. More here.