Licensed family child care credit

(a)

In general

Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 36B the following new section:

36C.

Licensed family child care credit

(a)

In general

In the case of a qualified taxpayer, there shall be allowed as a credit against the tax imposed by this subtitle for any taxable year an amount equal to so much of the qualified child care startup expenses of the taxpayer for such taxable year or for the preceding taxable year as do not exceed $5,000. (b)

Qualified taxpayer

For purposes of this section, the term qualified taxpayer means, with respect to a taxable year, a taxpayer that operates a qualified family child care provider. (c)

Qualified family child care provider

For purposes of this section, the term qualified family child care provider means a family child care provider that, with respect to a taxable year— (1)provides child care services for compensation that, as of the last day of such taxable year, is licensed or registered under State law and satisfies State and local requirements applicable to the child care services it provides, (2)primarily provides child care at the taxpayer’s primary residence, and (3)provided child care services to not less than 2 children (excluding children of such taxpayer) for a significant portion of such taxable year. (d)

Qualified child care startup expenses

For purposes of this section, the term qualified child care startup expenses means amounts paid or incurred for any of the following in order to establish and operate a qualified family child care provider: (1)Child care licensing fees. (2)Child care supplies including diapers, food, toys, and learning materials. (3)Liability insurance. (4)Fencing and installation of such fencing. (5)Outdoor playground equipment and installation of such equipment. (6)Furniture necessary to provide child care. (7)Salary of an employee other than the taxpayer. (8)Printer and computers. (9)Professional training required as a condition of State licensure or registration. (10)Remediation or renovation of the taxpayer’s primary residence required as a condition of State licensure or registration. (e)

Limitations

No credit shall be allowed under subsection (a) to any taxpayer to whom a credit was allowed under such subsection in any other taxable year. (f)

Denial of double benefit

No credit shall be allowed under subsection (a) for any expense for which a deduction or credit is allowed under any other provision of this chapter. (g)

Regulations

The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including regulations relating to such information reporting and coordination with state and local licensing or registration entities as the Secretary determines appropriate. (h)

Sunset

No credit shall be allowed under subsection (a) for any taxable year beginning after the date that is 7 years after the date of the enactment of this section.

(b)

Conforming amendment

Section 1324(b)(2) of title 31, United States Code, is amended by inserting 36C, after 36B,. (c)

Clerical amendment

The table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 36B the following new item:

Sec. 36C. Licensed family child care credit.

(d)

Effective date

The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act.