Affordable Child Care Act

HR 8635, the Affordable Child Care Act, doubles key tax benefits for families and employers to reduce child care costs. It increases the maximum tax credit for parents using child care from $3,000 (for one child) to $6,000 (or $6,000 for one child to $12,000 for two or more) and doubles the annual limit for employer-provided dependent care assistance from $5,000 to $10,000. The bill also doubles the tax credit employers can claim for providing on-site child care, raising the limit from $150,000 to $300,000 per year. These changes apply to tax years beginning after December 31, 2023, directly affecting working parents and businesses offering child care benefits.