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Florida businesses can take advantage of Florida’s new child care tax credit

Florida’s new tax credit for businesses that support employee childcare costs can be a significant advantage for employers that want to offer childcare benefits to their employees. By providing financial relief for childcare expenses, this initiative benefits both employers and employees, promoting greater workforce participation and enhancing overall economic well-being.

The Florida Chamber of Commerce estimates that child care issues are resulting in a $5.38 billion annual loss to the state economy.

This program offers a solution.

businesses can earn tax credits based on their support for employee childcare

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    • Startup costs for childcare facilities. Businesses can claim a tax credit of 50% of the startup costs for operating an eligible childcare facility for their employees. The maximum credit varies by the size of the business.
    • Monthly child care enrollment credit. Businesses can claim a tax credit of $300 per month for each eligible child enrolled in the facility. The maximum credit amount is also based on the size of the business.
    • Direct payments for childcare. Businesses making payments directly to an eligible childcare facility for the benefit of an employee’s child can claim a tax credit of 100% of these payments, up to $3,600 per child per year.
    • Carryforward provision. If the full amount of the credit is not utilized within the specified fiscal year, the unused amount may be carried forward for up to five years. This provision ensures that businesses can still benefit from the tax credits even if they cannot use the entire amount immediately.

Child Care tax credit benefits for businesses

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  • Tax Savings: The primary benefit is the reduction in state tax liability, allowing businesses to save money while supporting their employees.
  • Employee retention and satisfaction: Helping employees manage their childcare expenses can improve job satisfaction and retention. Employees who feel supported in balancing their work and personal lives are more likely to remain loyal and productive.
  • Attracting talent: Offering child care assistance can make businesses more attractive to potential employees, particularly in a competitive job market.

Businesses can begin applying for these tax credits on October 1, 2024.

Visit the Department of Revenue to learn more and start the process. Please share with your employer or other businesses.

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