Pennsylvania moms and dads will receive an extra chunk of change this tax season, thanks to a change made official in December when Gov. Josh Shapiro signed bipartisan legislation to expand the state’s Child and Dependent Care Enhancement Tax Credit.
A person can claim the credit on their Pennsylvania Personal Income Tax Return (PA-40) if they have a child under the age of 13, or live with an individual who is mentally or physically unable to care for him or herself.
“For a lower income family with 2 kids in childcare, their refundable tax credit, this past year in 2023, was $630. A nice credit, but only $630," Shapiro said at a press conference. "Starting this year, that same family is going to get $2,100.”
Previously, the state matched 30% of the federal credit Pennsylvanians’ received. Now, the state is matching 100%. $2,100 will be the maximum credit for a family of two or more children.
The U.S. Chamber of Commerce found that the state's economy and tax revenue struggle as a result of rising childcare costs.
"When we make it a little bit easier for Pennsylvanians to find care for their children and loved ones... we all benefit," Shapiro said. "That strengthens our businesses, that strengthens our workforce."
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