Iowa 2023-2024 Regular Session

Iowa House Bill HF695

Introduced
4/10/23  
Introduced
4/10/23  

Caption

A bill for an act relating to economic development including child care, grants and tax credits relating to child care, and state child care assistance, and including applicability provisions.

Impact

The bill also introduces a small business child care tax credit aimed at incentivizing businesses to offer child care benefits to their employees. This credit allows businesses to receive up to $3,000 per employee per year for providing child care benefits, with total credits capped at $2 million annually. In addition, the creation of a child care center and child development home grant fund is mandated, establishing a program for grants up to $50,000 to support the establishment or expansion of licensed child care facilities. This fund aims to address the critical shortage of affordable child care options in the state, aligning with workforce needs.

Summary

House File 695 is a legislative act aimed at enhancing economic development in the state by introducing several measures related to child care. The bill outlines a child and dependent care tax credit, which allows taxpayers to reduce their state income taxes based on the federal child and dependent care tax credit. This reduction is particularly generous for those with lower income levels, providing a 100% credit for taxpayers earning $45,000 or less, with scaled back percentages for those earning up to $200,000. Such measures hope to alleviate financial burdens on families, making child care more accessible.

Contention

This bill stands as a response to growing concerns regarding the accessibility and affordability of child care services, particularly for low-income families. However, it is likely to incite debate regarding its fiscal implications and the effectiveness of tax credits versus direct subsidies for families. Critics may question the sustainability of the tax incentives and whether they adequately address the foundational issues of limited child care availability and affordability for those at or below the poverty line. Stakeholders on opposite sides of the aisle may have differing views on whether developing child care infrastructure through grants or incentivizing businesses through tax breaks will yield the best outcomes for families in need.

Companion Bills

No companion bills found.

Previously Filed As

IA HF661

A bill for an act relating to child care, including the child and dependent care tax credit, a child care workforce matching grant program, a small business child care tax credit, and state child care assistance, and including applicability provisions.

IA SF460

A bill for an act relating to the child and dependent and early childhood development tax credits, and including retroactive applicability provisions.

IA HSB233

A bill for an act relating to state child care assistance eligibility requirements and child care provider reimbursement rates.(See HF 707.)

IA SF445

A bill for an act relating to early childhood education and care, including by modifying provisions related to the statewide preschool program, the child development coordinating council, programs for at-risk children, the responsibilities of the department of education, the early childhood Iowa initiative, and the state child care assistance program, establishing the child care continuum partnership grants pilot program within the department of health and human services, making appropriations and reducing appropriations, and including effective date provisions. (Formerly SSB 1135.)

IA HF1020

A bill for an act modifying the child and dependent care credit available against the individual income tax, and including retroactive applicability provisions.(Formerly HF 962.)

IA HF623

A bill for an act relating to early childhood education and care, including by modifying provisions related to the statewide preschool program, the child development coordinating council, programs for at-risk children, the responsibilities of the department of education, the early childhood Iowa initiative, and the state child care assistance program, and establishing the child care continuum partnership grants pilot program within the department of health and human services.(Formerly HSB 145.)

IA HSB145

A bill for an act relating to early childhood education and care, including by modifying provisions related to the statewide preschool program, the child development coordinating council, programs for at-risk children, the responsibilities of the department of education, the early childhood Iowa initiative, and the state child care assistance program, and establishing the child care continuum partnership grants pilot program within the department of health and human services.(See HF 623.)

IA SSB1135

A bill for an act relating to early childhood education and care, including by modifying provisions related to the statewide preschool program, the child development coordinating council, programs for at-risk children, the responsibilities of the department of education, the early childhood Iowa initiative, and the state child care assistance program, and establishing the child care continuum partnership grants pilot program within the department of health and human services.(See SF 445.)

IA HF962

A bill for an act modifying the child and dependent care credit available against the individual income tax, and including retroactive applicability provisions.(See HF 1020.)

IA HSB224

A bill for an act relating to property taxation for commercial child care centers and facilities and including effective date, applicability, and retroactive applicability provisions.(See HF 668.)

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