An Act to renumber 238.308 (1) (a); to amend 71.07 (3y) (a) 2., 71.07 (3y) (b) 6., 71.28 (3y) (a) 2., 71.28 (3y) (b) 6., 71.47 (3y) (a) 2., 71.47 (3y) (b) 6., 238.308 (2) (a) 1. and 238.308 (4) (a) 6.; to create 238.308 (1) (ag) and 238.308 (2) (d) of the statutes; Relating to: making certain child care expenditures eligible for the business development tax credit. (FE)
Summary
AB283 would expand Wisconsin’s business development tax credit to cover a broader range of employer child care costs, not just capital expenditures used to establish an employee child care program. Under the bill, eligible costs would include operating a child care program, reimbursing employees for child care expenses, purchasing or reserving child care slots, making contributions to dependent care flexible spending accounts, and other employer costs tied to facilitating child care services for employees. The credit would remain refundable and generally equal to up to 15 percent of qualifying costs.
The bill also updates related tax credit provisions in the individual and corporate income tax statutes so that the new child care expense category is recognized alongside existing workforce housing investments. It renumbers a definition in the business development credit statute, creates a new definition for “costs incurred to provide child care services for employees,” and authorizes the Wisconsin Economic Development Corporation to certify certain nonprofit 501(c)(3) entities for the credit when they provide child care services to employees. The bill applies first to taxable years beginning after December 31, 2024.
Impact
AB283 would amend multiple sections of Wisconsin tax law, including individual income tax, corporate income tax, and the business development tax credit statute, to broaden the types of employer child care expenditures that qualify for a refundable credit. It would expand the scope of eligible investments from only capital expenditures to a wider set of operating and employee-support costs, and it would allow nonprofit organizations to qualify for certification under the program. The practical effect would be to reduce after-tax costs for employers that provide or subsidize child care for workers, potentially encouraging more employer-sponsored child care benefits and related arrangements.
Sentiment
The bill’s overall policy direction appears supportive of employer-assisted child care and workforce support, with the introduced text reflecting a pro-business, pro-family-benefits approach. However, the available record shows no committee transcript or recorded votes, and the bill ultimately failed to pass pursuant to Senate Joint Resolution 1. As a result, there is no documented floor debate in the provided materials to show a broader consensus or organized opposition beyond the bill’s failure to advance.
Contention
The main policy issue is the breadth of the tax credit expansion. Supporters would likely favor the bill because it recognizes a wider range of child care-related costs, including ongoing operations and direct employee subsidies, not just construction or startup expenses. Potential concerns would center on the fiscal cost of a refundable credit, the administrative complexity of defining and verifying eligible expenses, and whether the credit should extend to nonprofit entities as well as businesses. Another possible point of contention is whether the state should subsidize employer-provided child care through the tax code rather than through direct child care or workforce programs.
Crossfiled
An Act to renumber 238.308 (1) (a); to amend 71.07 (3y) (a) 2., 71.07 (3y) (b) 6., 71.28 (3y) (a) 2., 71.28 (3y) (b) 6., 71.47 (3y) (a) 2., 71.47 (3y) (b) 6., 238.308 (2) (a) 1. and 238.308 (4) (a) 6.; to create 238.308 (1) (ag) and 238.308 (2) (d) of the statutes; Relating to: making certain child care expenditures eligible for the business development tax credit. (FE)