A BILL to amend and reenact § 58.1-439.4 of the Code of Virginia, relating to child day-care facility investment and child day-care expense reimbursement tax credits.
HB1412 amends Virginia’s child day-care facility investment and child day-care expense reimbursement tax credit statute. The bill extends the existing investment credit for employers that build, renovate, equip, or acquire child day-care facilities for employees’ children to taxable years beginning on and after January 1, 2027, and increases the maximum credit from $25,000 to $50,000. It also creates a new, separate credit beginning in 2027 for employers that pay or reimburse eligible child day-care expenses for employees’ dependent minors, equal to 25 percent of those costs up to a $50,000 cap.
The bill keeps the credits nonrefundable and allows unused credits to be carried forward for up to three taxable years. It also preserves the requirement that the facility be licensed under state law and that the Tax Commissioner approve applications, while changing the assumed credit amount used for approval and raising the annual statewide cap on approved credits from $100,000 to $5 million. The bill applies to taxable years beginning on and after January 1, 2027.
HB1412 would amend § 58.1-439.4 of the Code of Virginia to expand and modernize Virginia’s employer child care tax credit program. It would increase the per-taxpayer credit limit for child day-care facility investment, add a new credit for employer-paid or employer-reimbursed child care expenses, and raise the annual aggregate amount of credits that may be approved. The bill would affect taxpayers subject to the individual and corporate income taxes under §§ 58.1-320 and 58.1-400, as well as employers that sponsor or subsidize child care for employees.
The available legislative record shows no committee transcript, vote tally, or recorded floor debate, so there is no direct evidence of support or opposition in the materials provided. Based on the bill’s structure, it appears designed to encourage employer investment in child care and to reduce child care costs for working families, which typically draws favorable attention from business and family-policy advocates. However, the higher credit cap and expanded fiscal exposure could prompt scrutiny from fiscal conservatives or budget watchdogs.
The main points of potential contention are fiscal cost and program scope. Supporters are likely to favor the larger credit cap, the new reimbursement credit, and the higher statewide approval ceiling as tools to expand child care access and help employers recruit and retain workers. Opponents or skeptics may question whether the tax expenditure is cost-effective, whether the $5 million annual cap is sufficient or too generous, and whether the credits disproportionately benefit employers that already have the resources to establish or subsidize child care. Because the bill was left in Finance and no votes or transcripts are provided, no specific factional positions are documented in the record supplied.