Area Lawmakers Celebrate Expanded Child & Dependent Care Tax Credit

Touting the expanded Pennsylvania Child and Dependent Care Tax Credit as an economic development tool that will help young families and small businesses, Democratic state lawmakers gathered outside a day care in Bristol Township’s Levittown section on Thursday afternoon.

Those who qualify for the federal child tax credit automatically qualify for the state credit. The amount of the credit will vary based on household income and expenses. Families earning less than $43,000 are eligible for the full credit of $1,050 for one eligible dependent and $2,100 for two or more. For families earning more than $43,000, the maximum credit is $600 for one eligible dependent and $1,200 for two or more.

In 2023, Pennsylvania allowed families to claim a small percentage of the federal Child and Dependent Care Tax Credit. The previous credit gave families up to $180 in tax credits for one child and up to $360 for two or more children.

The expansion is expected to benefit at least 80 percent of Bucks County households that incur child care or dependent care expenses.

State Rep. Tina Davis, of Bristol Township, said families should make sure to apply or tell their accountants about the tax credits, if they don’t already know, when preparing returns.

The legislation was initially introduced as House Bill 1259 by Davis and passed by the Pennsylvania House with a bipartisan majority last June. Davis worked with the state Senate to make amendments to get it included into the state’s Fiscal Code bill. It was enacted in December.

Davis noted the challenge of finding affordable, reliable child care is a major hurdle for working parents, with average costs exceeding $1,000 per month for many.

“The passage of the expanded child care tax credit in Pennsylvania is a win for the working families of Bucks County and throughout Pennsylvania,” Davis said.

House Speaker Joanna McClinton, who represents part of Philadelphia and Delaware counties, traveled to Growing Little Footprints Daycare Center on Stonybrook Drive to laud the expansion of Pennsylvania Child and Dependent Care Tax Credit.

“House Democrats are delivering for all Pennsylvanians – from our students to our seniors to our working families,” said McClinton. “Pennsylvania’s improved Child and Dependent Care Tax Credit will help families balance their budgets and businesses whose employees depend on reliable and consistent child care to go to work.”

McClinton said she worked at a child care center as a teenager and she knows the work is important.

“The expansion of the child tax credit here in Pennsylvania puts money back in the pocket of working families when they need it most,” said State Sen. Steve Santarsiero, of Lower Makefield Township. “This critical investment in families with young children will help more parents enter the workforce and help grow our local economy. I’d like to thank my friend and colleague, Rep. Tina Davis, for advocating for this significant boost for Pennsylvania families.”

Valerie Hamilton, owner and director of Children of God Educational Services in Bristol Borough, said the cost to run early learning centers has increased as businesses struggle to paying teachers and other staff a fair wage amid a tight labor market.

“The teachers give their all and make sure children are cared for – something you cannot put a price tag on,” she said, adding she appreciated the bipartisan support for the tax credit.

Bucks County resident Jasmine Swinehart said the tax credit has helped her afford day care.

“I wouldn’t be able to work at all,” Swinehart said. “I wouldn’t have anything without the child tax credit.”

Dan O’Brien, the policy manager for Education and Family Stability, Children First, commended the tax credit and said more can be done in Harrisburg to reduce the cost of child care.

State Rep. Perry Warren, of Newtown, said his family with five kids knows the struggle of paying for child care. He added that the bill supports parents, child care providers that are often small businesses, and the workforce.

“It’s great for the economy because it ensures people who work are able to do so,” he said.

State Rep. Tim Brennan, of Doylestown Borough, called the tax credit expansion an “excellent bill” that will support people across Bucks County.

“This law is so important and really benefits working families,” he said.

State Rep. Brian Munroe, of Warminster Township, said: ““The expansion of the child care tax credit is a true economic boost for all 67 counties in Pennsylvania, especially Bucks County. It allows those who might not have otherwise been able to afford child care to put their children in day care, which will allow them to not miss work.”