Senate Bill 321 (SB 321) would establish a tax credit package focused on families, child care workers, and employers who provide dependent care support. The package establishes three tax credits (child tax credit, child care worker tax credit, and business-supported dependent care tax credit).
The child tax credit is a refundable credit to support Montana families’ financial freedom to mitigate the high cost of raising young children. A family qualifies for a $1,200 refundable tax credit for any child under the age of five.
The credit for child care workers is a refundable credit for child care workers to stabilize the workforce behind the workforce. A child care worker who works more than 20 hours a week and for more than 6 months out of the year qualifies for a $1,600 tax credit.
The business-supported dependent care credit is a refundable tax credit for employers who provide dependent care assistance to or on behalf of their employees. An employer qualifies for a tax credit up to $5,000 per tax year. Dependent care includes both children as well as other dependents, including elderly parents. The bill is written in a way that gives employers flexibility to support their employees in the way that works best for them, whether they create on-site child care, offer a childcare FSA, create a child care co-op, or many more potential solutions.
