Child and Dependent Care Tax Credit Enhancement Act of 2024

HR 7252, the Child and Dependent Care Tax Credit Enhancement Act of 2024, increases the maximum credit amounts for child and dependent care expenses to $8,000 for one child and $16,000 for two or more children. It adjusts income thresholds so the credit begins phasing out at $125,000 of adjusted gross income and slows the phaseout rate above $400,000. The bill also makes the credit refundable for eligible taxpayers (allowing refunds even if no tax is owed) and adds automatic annual inflation adjustments to the credit limits starting in 2025. These changes directly affect families paying for childcare or dependent care to work or seek employment.