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Tuesday, July 8, 2014

Shaheen in Nashua to discuss legislation to expand tax credits for child care

NASHUA – It’s time child care tax credits are updated for the first time since their introduction in 1976, U.S. Sen. Jeanne Shaheen, D-N.H., said during a visit to the Adult Learning Center’s Early Childhood Adventures Program on Monday.

Shaheen said childhood education costs families about $12,000 per year in New Hampshire. ...

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NASHUA – It’s time child care tax credits are updated for the first time since their introduction in 1976, U.S. Sen. Jeanne Shaheen, D-N.H., said during a visit to the Adult Learning Center’s Early Childhood Adventures Program on Monday.

Shaheen said childhood education costs families about $12,000 per year in New Hampshire.

“Just as families have changed, costs have changed. We need to make sure our tax credit better reflects the real costs families are paying,” she said.

Coordinator Jane Marquis led a tour of the center’s child care facility accompanied by Mayor Donnalee Lozeau, previous ALC director Mary Jordan and current director Carol Baldwin, state Senators Bette Lasky and Peggy Gilmour, as well as Adult Learning Center staff.

The “Helping Working Families Afford Child Care Act,” supported by U.S. Senators Shaheen, Barbara Boxer, Patty Murray and Kirsten Gillibrand, would change tax credit for child care in three ways.

First, it would increase the amount of eligible expenses.

The present law gives a credit for 20 to 35 percent of child care expenses totaling $3,000 for one child and $6,000 for two or more children. The 20 percent credit rate applies for family incomes of $43,000, allowing those households a maximum credit of $600 or $1,200.

The new expense guidelines would be $8,000 for one child and $16,000 for two or more children.

It also would allow low- and middle-income families a maximum credit of $1,600 or $3,200 in 2015. The act would include inflation so the credit does not lose value over time.

Second, the credit would be fully refundable.

Currently, families who don’t owe federal income tax because their income is too low cannot use the credit.

The proposed change would make these families eligible for a refund.

Lastly, the initiative would narrow eligibility to families in the most need.

Shaheen said the child care credit would gradually be phased out for anyone making over $200K per year.

“Working families who get help with childcare are much more likely to stay working,” Shaheen said.