Child Care Tax Credit

Many companies have discovered the advantages of family-friendly policies like on-site day care centers. Not only do employees love the security and contact with their children, companies find it an excellent recruiting tool. Employee retention is improved and job satisfaction skyrockets.

Unfortunately, the supply of affordable, quality child care in our country is not keeping up with the demand. Many working families simply cannot find care for their young children in communities with few or no licensed child care facilities. This shortage is not just inconvenient, it is a missed opportunity. We know that good early childhood programs can improve children's chances of long-term success in school, higher earnings as adults, and decreased involvement with the criminal justice system. And employers who offer child care attract more highly qualified applicants, greater loyalty and less absenteeism.

We need a partnership between government, communities and private businesses to create a network of child care facilities that are safe and stimulating for children, while being affordable and convenient for parents. That's why I sponsored legislation to provide a tax credit to businesses that help increase the supply of quality child care for working families. I'm pleased that this child care tax credit was made law on June 7, 2001.

The child care tax credit is a simple, common sense start. My legislation provides a 25 percent tax credit to businesses for expenses related to the acquisition, expansion, or repair of an on- or near-site day care center, after-hours care facility, or sick-child facility. This credit would also be available for a consortium of businesses that join together to create a child care center, and for company expenditures on training and continuing education for child care workers. The credit is capped at $150,000 per year.

The provision also contains a 10 percent business credit for the cost of a company's contract with a Child Care Resource and Referral service, to help parents locate child care in their communities.

I have visited business-sponsored child care facilities across Wisconsin and have seen how much satisfaction the situation can bring employers and employees alike. This law makes us all partners in ensuring we have enough quality child care for working families and productive employees.

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