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Resources for Providers

How Employer Tax Credit Can Benefit Providers

Federal law makes a 25% tax credit available to employers that provide activities such as:

• The acquisition, expansion, or repair of an on- or near-site child development center, a center that provides after hours care, or a center for sick children.
• A consortium of businesses that join together to create and open a child development center.
• Direct company subsidization of the operating costs of a child development facility.
• A company's expenses for the reservation of space for their employees in a licensed, child development facility.
• Company expenditures used for education and professional development for child development teachers and providers.

This employer tax credit is capped at $150,000 per year, and companies only receive the tax credits for capital expenditures on facilities that stay in operation for several years and primarily serve their employees. There is also a credit of 10% for the cost of a company's contract with an early care and education resource and referral service.

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