A new Joint Economic Committee report highlights how existing child care tax benefits can lower costs for working families while helping employers recruit and retain workers. The report examines three tools—the Child and Dependent Care Tax Credit, Dependent Care Assistance Programs and the Employer-Provided Child Care Credit—and finds that these resources remain significantly underused despite offering meaningful savings.
In one scenario, a company investing $2.8 million in employee child care over five years could save $820,000 in taxes and generate another $8.1 million through stronger retention and productivity. Participating employees could save nearly $10,000 in child care expenses. With employer-supported child care returning an estimated $2.90 for every dollar invested, greater awareness and technical assistance could help families, businesses and communities benefit from tools already available under current law.