Employer Child Care Tax Credit
Partner with Chroma Early Learning and provide your employees Childcare benefits at no cost to you or your employee*
💡 What These Tax Credits Are
Federal Credit (Section 45F under the One Big Beautiful Bill Act):
Under the One Big Beautiful Bill Act, the federal employer-provided child care tax credit has been expanded:
The credit now covers up to 40% of qualified child-care facility expenses for most employers, and 50% for “eligible small businesses” (defined by gross receipts).
The maximum annual credit increased from $150,000 to $500,000 (or $600,000 for small businesses).
Qualified expenses include building/upgrading a licensed child-care facility, contracting with a third-party provider to serve your employees’ children, severing backup care, etc.
Effective for expenses incurred on or after January 1, 2026.
Georgia State Credit (under House Bill 136 and O.C.G.A. § 48-7-40.6):
Employers in Georgia who provide or sponsor child care for their employees already have access to a state tax credit of up to 75% of their direct costs (costs paid to operate or contract child care) under O.C.G.A. § 48-7-40.6.
Important limitation: The state credit cannot exceed 50% of the employer’s Georgia income tax liability for the taxable year.
Under HB 136 (effective for tax years 2026+): Employers who cover at least $1,000 in child-care support for an employee’s child (age ≤ 6) can claim a Georgia credit of $1,000 for the first year, and $500 in later years. The total employer tax credit pool is capped at $20 million.
How It Works (Employer Steps)
Partner with Chroma – whether you reserve slots at our centers, subsidize employee tuition, contract for child-care services, or build/expand a facility.
Track and document qualifying expenses – We’ll supply itemized invoices and summaries of expenses that qualify under federal (Section 45F) and Georgia state credit rules.
For the federal credit:
File IRS Form 8882 (“Credit for Employer-Provided Child Care Facilities and Services”) with your federal return.
Ensure expenses are incurred on or after Jan 1 2026 if you want to use the expanded credit.
Work with your tax advisor to confirm you meet the “eligible small business” threshold if you aim for the higher 50% rate.
For the Georgia state credit:
Submit the required schedule with your Georgia corporate income tax return showing: employee names, child-care provider names, cost amounts, etc. (required by O.C.G.A. §48-7-40.6).
If using the new HB 136 employer support credit ($1,000/$500 per child), apply via the applicable state form (check with your CPA or the Georgia Department of Early Care and Learning).
Remember the 50% of tax-liability cap applies.
Benefit your workforce & your bottom line – These credits reduce your tax burden and help you provide a highly attractive employee benefit: quality child care for working parents.
Ga Pre-K Lottery
Unlock educational opportunities with our Ga Pre-K Lottery program.
AfterSchool
Enriching and safe after-school care tailored to children's growth.
Kindergarden
Nurture young minds with personalized attention and engaging activities.
Why this Matters for Your Business
Attract & retain talent – Child care is a top benefit for working parents, especially in Metro Atlanta’s competitive labor market.
Improve productivity – Less absenteeism, fewer distractions, happier employees.
Tax efficiency – Significant “dollar‐for‐dollar” reduction in tax liability from both federal and state credits.
Community impact – You support early childhood development and strengthen your community, aligning with CSR values.
First-mover advantage – With the expanded federal credit effective 2026, getting ahead now positions you as a leader in employer-provided benefits.
🪙 Ready to Learn More?
Let’s build your employer childcare partnership plan today.
📧 Email: [email protected]
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* Important Disclaimers
This summary is for informational purposes only and does not constitute tax or legal advice. Please consult your tax advisor for specific eligibility, compliance, carry-forward rules, recapture risk, and interaction with other credits/deductions.
The federal credit under Section 45F is non-refundable (you cannot get cash back; it offsets federal tax liability).
Georgia credits are also subject to limits (no refund beyond tax liability, may be carried forward for a set period).
The federal expanded credit only applies to expenses incurred on or after January 1, 2026.
For Georgia’s new employer support credit ($1,000/$500 per child) under HB 136: effective 2026+, subject to state pool cap of $20 M and may have additional rules.
