[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3534 Introduced in Senate (IS)]
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119th CONGRESS
1st Session
S. 3534
To amend the Internal Revenue Code of 1986 to provide a credit for
increasing wages paid to child care providers.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
December 17, 2025
Mr. Warner (for himself and Mr. Justice) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide a credit for
increasing wages paid to child care providers.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. CHILD CARE SUPPLY CREDIT.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by adding at the end
the following new section:
``SEC. 45BB. CHILD CARE SUPPLY CREDIT.
``(a) In General.--For purposes of section 38, the amount of the
child care supply credit determined under this section with respect to
any employer for any taxable year is an amount equal to the applicable
percentage of the qualified child care wages paid or incurred by the
employer.
``(b) Applicable Percentage.--For purposes of this section--
``(1) In general.--Except as provided in paragraph (2), the
applicable percentage is 5 percent.
``(2) Rural areas.--
``(A) In general.--In the case of qualified child
care wages paid or incurred with respect to employment
at an eligible childcare facility which is located in a
rural area, the applicable percentage is 7 percent.
``(B) Rural area defined.--For purposes of this
paragraph, the term `rural area' means any area other
than an urban area (as defined in section 101(a)(35) of
title 23, United States Code).
``(c) Definitions.--For purposes of this section--
``(1) Qualified child care wages.--
``(A) In general.--The term `qualified child care
wages' means wages paid to qualified child care
workers.
``(B) Wages.--The term `wages' has the meaning
given such term by subsection (b) of section 3306
(determined without regard to any dollar limitation
contained in such section). Such term shall not include
any amount taken into account for purposes of
determining any other credit allowed under this
subpart.
``(2) Qualified child care worker.--
``(A) In general.--The term `qualified child care
worker' means any employee who--
``(i) is employed at an eligible child care
facility, and
``(ii) provides child care services.
``(3) Eligible child care facility.--The term `eligible
child care facility' means any facility which--
``(A) provides child care services for at least 6
individuals,
``(B) receives a fee, payment, or grant for
providing such services, and
``(C) complies with all applicable laws and
regulations of a State or unit of local government.
``(4) Child care services.--The term `child care services'
means the providing of care, education, protection,
supervision, or guidance to children.
``(d) Election To Have Credit Not Apply.--
``(1) In general.--A taxpayer may elect to have this
section not apply for any taxable year.
``(2) Other rules.--Rules similar to the rules of
paragraphs (2) and (3) of section 51(j) shall apply for
purposes of this subsection.''.
(b) Credit Treated as Part of General Business Credit.--Section
38(b) of the Internal Revenue Code of 1986 is amended by striking
``plus'' at the end of paragraph (40), by striking the period at the
end of paragraph (41) and inserting ``, plus'', and by adding at the
end the following new paragraph:
``(42) the child care supply credit determined under
section 45BB(a).''.
(c) Elective Payment.--Section 6417(b) of the Internal Revenue Code
of 1986 is amended by adding at the end the following new paragraph:
``(13) The child care supply credit determined under
section 45BB(a).''.
(d) Denial of Double Benefit.--Section 280C(a) of the Internal
Revenue Code of 1986 is amended by inserting ``45BB(a),'' after
``45S(a),''.
(e) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of the Internal Revenue Code of
1986 is amended by adding at the end the following new item:
``Sec. 45BB. Child care supply credit.''.
(f) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
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