Photo via Stephanie Murphy/Facebook
U.S. Reps. Stephanie Murphy, D-Winter Park, and Jason Smith, R-Missouri, introduced bipartisan legislation Wednesday that lawmakers say would help working-class families in Central Florida gain access to affordable child care.
"For far too long, working families have struggled with the rising costs of child care," Murphy says. "Our tax code should reflect our priorities, and one of our top priorities must be our children."
The Promoting Affordable Childcare for Everyone Act
, or PACE Act, would modernize the Children Dependent Care Tax Credit, or CDCTC, a non-refundable tax credit that reduces taxpayers' income liability based on expenses incurred on child or dependent care.
Aside from making the CDCTC refundable, the bill would qualify child care expenses that include payments to nannies, housekeepers and relatives, as well as day care facilities, preschools and day camps.
Under the PACE Act, a taxpayer with annual income of $30,000, two children and $6,000 in child care expenses would receive a credit of $2,520, according to the nonpartisan Congressional Research Service.
Current law grants the same taxpayer just $1,620.
The PACE Act would also adjust the CDCTC income levels and maximum credit amounts for inflation – $3,000 for a taxpayer with one child and $6,000 for a taxpayer with two or more children – as well as increase the maximum amount of the income exclusion for employer-sponsored child and dependent care to $7,500, up from $5,000 under current law.
Murphy says the annual cost of child care for a 4-year-old in Florida is $7,688 – compared to the average cost of tuition and additional fees for a semester at the University of Central Florida, which is roughly $6,000 for a full-time undergraduate student.
The legislation has been endorsed by Childcare Aware, the Council for a Strong America, First Five Years Fund, First Care, Kinder Care and Save the Children Action Network.
"The PACE Act would provide families with the opportunity to invest in their child's future, particularly for children living in poverty who lack an equal opportunity to succeed," says Mark Shriver, CEO of Save the Children Action Network.
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