Pennsylvania Announces New Childcare Tax Credit 

Photo provided by the Centers for Disease Control and Prevention

By Mike Lynn

A tax credit ranging from $180 to $630 is available to help offset childcare costs for working Pennsylvania families with children in daycare.

PENNSYLVANIA STATE | On Sept. 29, 2022, Pennsylvania announced a childcare tax credit which approximately 221,000 families will benefit from. Pennsylvania's $25 million childcare tax credit program provides tax credits ranging from $180 to $630 and is meant to benefit working families with children.

This state-level childcare tax credit program is modeled after the federal childcare tax credit program and is intended to benefit working families with children in daycare who already qualify for the federal program. Households earning above $43,000 are eligible for a credit of $180 for one child or $360 for two or more children. Households earning less than $43,000 are eligible for a credit of $315 for one child or $630 for two or more children. Pennsylvanians paying for child care services can claim the credit when filing state taxes starting in 2023.

"Pennsylvania's hard-working families deserve the chance to succeed. That's why I created this childcare tax credit program," said Gov. Wolf. "With some money back in their pockets, they can work or go back to school while ensuring their children are thriving at a quality child care center."

"High-quality early education programs help build a foundation for children's learning and development, and for parents, knowing that they can afford high quality, reliable care for their children, while they are working, is immeasurable," said Department of Human Services Acting Secretary Meg Snead. "This tax credit will help ease the affordability burden on lower income, working families, and we must do everything we can to continue supporting parents and children in the commonwealth so they can continue to benefit from the incredible, life-shaping work our child care industry does every day."