The First Five Things to Know About: The Kaine-Britt Bipartisan Child Care Plan

When child care is hard to find and hard to afford, it has a devastating impact on children, families, and the economy.

Over the past few decades, the cost of child care has risen by an estimated 263%. The high cost and low availability of child care forces families to make tough decisions. Some parents may have to put their careers on hold. Many go into debt or take on considerable financial strain. 

And child care challenges do not only affect families — they have become a leading concern among employers, particularly small businesses. Many employers report that child care challenges directly impact their ability to recruit and retain employees. This has serious repercussions on daily productivity and ultimately affects their bottom lines and costs our national economy billions of dollars in lost revenue, earnings, and productivity every year.

The Child Care Availability and Affordability Act would modernize three existing tax provisions to help more families afford child care.

Strengthening existing federal tax provisions – including the Child and Dependent Care Tax Credit (CDCTC), DCAP (Dependent Care Assistance Plans), and the Employer-Provided Child Care Tax Credit (45F) – would help more families find and afford the child care options they need.

Here’s how that would work:

• The legislation would broaden the Child and Dependent Care Tax Credit (CDCTC) – the only tax credit that specifically helps parents pay for child care – by making the credit refundable for low- and middle-income working families and expanding the maximum amount parents can receive to $2,500 for families with one child and $4,000 for families with two or more children.
• It would strengthen Dependent Care Assistance Plans (DCAP) by increasing the amount of pre-tax dollars families can put into a child care assistance plan (similar to a Flexible Spending Account) from $5,000 to $7,500. 
• And it would bolster the Employer-Provided Child Care Tax Credit (often referenced as 45F), supporting businesses who want to provide child care to their employees and allowing small businesses to work together to provide child care to employees.
• Here is an explainer of the three tax provisions.

The policies in the Child Care Availability and Affordability Act are popular with voters.

• In a 2025 poll, Americans said they overwhelmingly support (86%) expanding the Child and Dependent Care Tax Credit (CDCTC), including 83% of Republicans, 83% of Independents, and 91% of Democrats.
• They also strongly support expanding DCAP, including 86% of Republicans, 80% of Independents, and 83% of Democrats. 
• And they strongly support expanding 45F, with 81% of Republicans, 76% of Independents, and 81% of Democrats approving.

The package also contains the Child Care Workforce Act, which would address early educator shortages by establishing a pilot program to boost the supply of child care workers.

• It would implement a competitive grant program for organizations interested in adopting or expanding pay supplement programs for child care workers to decrease turnover.
• Grantees would also be able to provide supplements to both home-based and center-based child care providers who are licensed by the state.