Proposal will make child and dependent care more affordable for New Jersey families
Trenton – In an effort to make child care more affordable, the Senate today passed legislation sponsored by Senators Dawn Marie Addiego and Troy Singleton, which 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, from $60,000, 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.”
“Our state is a great place to live, but it is also an expensive place to live. That is why we must work each and every day to make New Jersey more affordable,” said Senator Singleton (D-Burlington). “The affordability crisis affects us all, especially those families who shoulder the expense of child care. With this legislation, it is our hope to expand the number of families who are eligible while also allowing caretakers to get excess credit back in their pockets.”
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 the Senate by a vote of 35-0 and was sent to the Governor for final approval.