Tax Credits, Employer Programs & Other Options

2021 Tax Credit Information: The Biden-Harris Administration celebrates Child Tax Credit Awareness Day. President Biden’s American Rescue Plan (ARP) Act included historic investments to support low- and middle-income parents who have long faced increasing financial strain, worsened by the coronavirus disease 2019 (COVID-19) pandemic. Child Tax Credit Awareness Day is meant to ensure that parents know about the ARP Act’s historic expansion of the child tax credit (CTC) and how it will benefit their families.

The CTC Provides Major Tax Relief for Nearly All Working Families

• All working families will get the full credit if they make up to $150,000 for a couple or $112,500 for a family with a single parent (also called head of household).

• The CTC has been expanded to $3,000 per child ages 6–17 years and $3,600 per child younger than age 6.

• Roughly 39 million households—covering 65 million children (nearly 90 percent of children in the United States)—will automatically receive the new CTC.

• Starting on July 15th and continuing through the rest of the calendar year, payments of $250 per child between ages 6–17 or $300 per child younger than age 6 will be made monthly (via direct deposit for 80 percent of families and through the mail for the others).

• The Internal Revenue Service has launched a simplified online tool that will allow families not automatically enrolled in the program to receive the CTC. For more information, visit ChildTaxCredit.gov.

President Biden’s American Families Plan Calls for Extending the CTC for Years and Years

The new CTC enacted in the ARP Act is only available for 2021. President Biden strongly believes that we should extend the new CTC for years to come, and he proposes to do that in his American Families Plan.

Easy Signup for Low-Income Families To Cut Child Poverty in Half

Low-income families with children are eligible for this crucial tax relief, including those who have not made enough money to be required to file taxes. If a couple makes less than $24,800, a head of household makes less than $18,650, or a single filer makes less than $12,400, and they have not filed their taxes, a simple, easy tool is available to sign up for the CTC. Learn more at ChildTaxCredit.gov.

Tax Credits

Tax credits do not provide immediate help with paying for child care, but they reduce the amount of tax owed and help to maximize your refund. A tax refund, if received, can be set aside for other costs (like child care) to be used throughout the year. Visit www.irs.gov for more information on the following tax credits:

• Child and Dependent Care Tax Credit: This credit is available to people who are paying for child care so that they can work or look for work. The credit is a percentage based on your adjusted gross income and the amount of work-related child and dependent care expenses you paid to a care provider.

• Earned Income Tax Credit: This is a tax credit for moderate- to low-income working individuals and families. The amount of the credit varies depending on your level of income and how many dependents you support.

Local Child Care Programs

Additional assistance may be available from your provider or other local child care programs. Families are encouraged to ask their provider if any of the following are available at their program:

• Sliding fee scale: Some providers may offer fees based on a sliding scale, using an income based system to determine cost.

• Negotiable Fees: Some programs might be willing to negotiate fees on a case by case basis.

• Private Scholarships: Some programs offer private scholarships and/or accept scholarship funds.

• Multi-Child Discounts: Some programs offer fee reductions to parents with more than one child enrolled in care.

Work & School Related Programs

Have you looked into child care assistance options based on where you work or go to school? Take the time to visit your employer’s human resources or finance office, or your college or university’s student services department to see if you might be eligible for any of the following benefits:

• On-Site Child Care Centers & Discounts: Your employer or school may have an on-site child care center with reduced rates, or offer discounts through certain child care programs.

• Child Care Vouchers or Reimbursements: An employer may offer workers a child care allowance or subsidy that families can use toward a child care arrangement of their choice.

• Employer Assisted Dependent Care Account: Your employer may allow employees to put a portion of each paycheck into a special fund for child care. The money placed in these funds is not taxed and can only be used toward the cost of care.

• Review Your Benefit Package: Some employers allow employees to choose from a menu of benefits and customize their benefits package. For example; if your health insurance is covered under someone else’s plan, you might be able to choose a child care benefit instead of health insurance.

Syracuse University, University College Child Care Grant

This is special grant program for certain eligible Syracuse University undergraduate students that helps pay for child care. Child Care Solutions can help Child Care Grant applicants by providing a list of child care providers, call (315) 446-1220 ext. 303 for assistance. Find more information on this program.

Military/DoD Families:

Child Care Aware ® of America offers child care fee assistance to eligible members of the military. Each branch of service has its own eligibility requirements, which can be found here, along with other program information. To speak with a specialist about the military and DoD child care programs, please call 1 (800) 424-2246.