Press Releases

Reps. Davis, DelBene Introduce The Child Care and Dependent Credit Enhancement Act of 2017

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Washington, DC, May 25, 2017 | comments

Today, Reps. Danny K. Davis (D-IL-07) and Suzan K. DelBene (D-WA-01) introduced the Child Care and Dependent Credit Enhancement Act of 2017. The average cost of daycare for children up to age four has climbed to $9,589 annually, more than the average cost of state college tuition. For families earning the national median income, the average cost of care for just one child under five amounts to 18 percent of their income, and for families in lower income brackets, child care alone could cost as much as two-thirds of their pay. With child care expenses growing more rapidly than inflation, and income gains remaining relatively modest, it is likely that child care will continue to place a major financial burden on American families, especially those with average and lower incomes.

Congressman Davis stated, “Most young children in the U.S. have parents who work outside the home.  For single mothers and fathers the need is especially acute.  When families cannot afford child care the alternatives are use of unlicensed, substandard care or lost family income due to family members dropping out of the labor market.  Both options are detrimental to the well-being of children, to families, and to communities.  This legislation helps make quality child care available to every family.”

Congresswoman DelBene stated, “I often hear from constituents struggling with the rising cost of child care - some even deciding to leave the workforce because the costs exceed their wages. We absolutely must update and improve our tax code to help these working families. That's why I've joined Congressman Davis in introducing legislation to expand the Child and Dependent Care Tax Credit, which helps grow our middle class. This important measure would provide much needed tax relief and should be included in any comprehensive tax reform package.”

The Child Care and Dependent Credit Enhancement Act will:

  • Expand the tax credit and makes the Child Care and Dependent Care Tax Credit (CDCTC) refundable, providing families with tax relief to offset the rising cost of child care, typically the largest or second largest annual expense for middle- and lower-income families.
  • Make the full credit available to most working families: This bill would make the full credit available to families with income under $120,000. The current phase-out of the credit begins at $15,000 of income.
  • Put more money into a family's pocket: The bill increases the maximum credit from $1,050 to $3,000 per child (age 0-13), up to $6,000 per family.
  • Ensure lower income families see a benefit: The bill would make the credit fully refundable to make sure those with the greatest need see a benefit.
  • Retain the value over time: The bill would index benefits to inflation to ensure they keep up with ever-growing costs.

The tax code has long recognized the need to provide families with tax relief to offset this expense through the Child and Dependent Care Tax Credit. As currently structured, however, very few families receive meaningful benefit from the credit. This is in part because the credit begins to phase out for those with income over $15,000, and in part because the credit's expense limits and income scales have not been indexed to inflation. Middle class families need more support in providing their children with quality care, particularly for children under five, whose expenses are especially high.

The legislation is also supported by:

9 to 5 · American Federation of Teachers · Center for Law and Social Policy · Child Care Aware of America · Children's Defense Fund · Early Care and Education Consortium · First Five Years Fund · First Focus Campaign for Children · Jobs with Justice · Moms Rising · National Association for Family Child Care · National Association for the Education of Young Children · National Black Child Development Institute · National Head Start Association · National Women's Law Center · Ounce of Prevention Fund · Restaurant Opportunities Center United · Save the Children · Save the Children Action Network · Teaching Strategies · Zero to Three · Pennsylvania Partnerships for Children

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