Child Care Availability and Affordability Act

The Child Care Availability and Affordability Act increases tax benefits for families and employers related to child care costs. It raises the employer child care credit from 25% to 50% of qualified expenses (with a higher $600,000 limit for small businesses), increases the amount excludable from income for dependent care assistance from $5,000 to $7,500, and creates a new refundable household and dependent care credit covering up to 50% of eligible expenses (with income-based adjustments). This credit applies to expenses for household services and care of qualifying children under 13 or dependent relatives needing assistance. The bill directly affects working families with children, elderly or disabled dependents, and employers providing child care benefits, with changes applying to tax years beginning after enactment.