Trenton – In support of New Jersey families, the Senate Budget and Appropriations Committee advanced legislation sponsored by Senator Dawn Marie Addiego that would revise the State’s child and dependent care tax credit, to make the credit refundable.
The bill, S-4065, would revise the credit so that taxpayers would receive a cash refund if the credit amount is greater than their liability. It also expands the eligibility to include New Jerseyans who have an income of up to $150,000 per year.
“In our state, the cost of dependent care and childcare can be financially debilitating for many families. The expansion of the child and dependent care tax credit will ensure that more people are able to afford the proper services they need,” said Senator Addiego (D- Atlantic, Burlington, Camden). “The funds that taxpayers are getting back from excess credit can be used for other necessities and in light of the financial burden the pandemic has caused for many people, this is a major step in the right direction.”
Under current law, the tax credit is nonrefundable and any credit that is greater than the taxpayer’s liability is unable to be claimed. Currently, the maximum New Jersey credit cannot exceed $500 per qualifying individual and $1,000 for two or more individuals.
The bill was released from committee by a vote of 12-0.