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Published:   |   Last Updated: March 6, 2024

Employer-Provided Childcare Credit 

If you are an employer who provides childcare services to your employees, you might be eligible for the Employer-Provided Childcare Credit. The credit is an incentive for taxpayers to provide childcare services to their employees.

To be eligible for the credit, an employer must have paid or incurred qualified childcare expenditures during the tax year to provide childcare services to employees.

Qualified childcare expenditures are:

  1. Costs associated with acquiring, constructing, rehabilitating or expanding property used as the taxpayer’s qualified childcare facility.
  2. Qualified childcare facility expenditures are operating expenses made by the taxpayer, including amounts paid to support childcare workers through training, scholarship programs, and providing increased compensation to employees with higher levels of childcare training.
  3. Expenditures under a contract with a qualified childcare facility to provide childcare services to employees.
  4. Qualified resource and referral expenditures which includes any amount paid or incurred under a contract to provide childcare resource and referral services to an employee.

To claim the credit, use Form 8882, Credit for Employer-Provided Childcare Facilities and Services.

The credit amount claimed may not exceed $150,000.

To learn more about qualifying resources and expenditures, visit irs.gov.