S. 4918: Right Start Child Care and Education Act of 2026

This bill would create a new federal tax credit for certain people who work in child care facilities and have relevant education or credentials.

What the credit would do

Starting with tax years after December 31, 2026, an eligible worker could claim a credit against their federal income tax if they work in a licensed child care setting and meet the bill’s requirements. The credit amount would depend on the worker’s qualifications:

• $4,500 for someone with a bachelor’s degree in early childhood education, child care, or a related field.
• $3,000 for someone with an associate’s degree in one of those fields.
• $1,500 for someone who meets the other requirements but does not have one of those degrees.

Who could qualify

To be considered an eligible child care provider, a person would generally have to:

• Hold either a bachelor’s degree or associate’s degree in early childhood education, child care, or a related field from an eligible school, or hold an active Child Development Associate credential from the Council for Professional Recognition.
• Work at least 1,200 hours during the year providing child care services.
• Work at a facility whose main purpose is child care.
• Work at a facility where no more than 25% of the children served are the worker’s own children or the children of the worker’s spouse.
• Work at a facility that follows all applicable state and local laws and licensing rules.

The bill says the facility does not have to meet the “main purpose is child care” requirement if it is the operator’s principal residence.

How long the credit would last

The credit would not be permanent for each person. An individual could elect to claim it for a taxable year, but once the election has been in effect for three prior taxable years, they could not make that election again for another year. In practical terms, the credit is designed to be available for up to three years per person.

Other technical changes

The bill also makes small updates to the tax code and related laws so that this new credit is properly included in existing IRS rules and refund provisions.

Relevant Companies

None found.