Employers seeking ways to attract and retain top talent may want to consider providing child care services to staff. A significantly enhanced tax credit can make this more feasible. For 2025, the maximum credit is $150,000. For 2026, it will increase to $500,000 ($600,000 for eligible small businesses). The 2026 credit will equal 40% of the employer’s eligible child care expenses (up from 25% in 2025), or 50% for eligible small businesses. Qualifying expenses include the purchase, construction, expansion or rehabilitation of a child care facility and related operating expenses. Employers may contract with a qualified child care facility to provide such services. Contact us with questions.
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