House Bill 5084 would repeal West Virginia’s existing child and dependent care credit and replace it with a new refundable state child tax credit. Beginning with tax years starting on or after January 1, 2026, a resident individual who claims the federal child tax credit for an eligible child could claim a $1,000 credit against West Virginia personal income tax. If the credit exceeds the taxpayer’s income tax liability, the excess would be refunded, making the benefit available even to families with little or no state income tax owed.
The bill defines an eligible child by reference to the federal child tax credit rules under Internal Revenue Code section 24, tying the state credit to federal eligibility. The Legislature states that the purpose of the measure is to support working families, reduce child poverty, and strengthen the state economy. In practical terms, the bill would create a permanent refundable income tax benefit for qualifying West Virginia residents with children and would shift the state’s child-related tax relief from a nonrefundable structure to a refundable one.
Impact
HB5084 would amend West Virginia’s personal income tax law in Article 21 of Chapter 11 by adding a new section, §11-21-98, and repealing §11-21-26, which currently provides the child and dependent care credit. The new provision would authorize a refundable $1,000 child tax credit for resident taxpayers beginning in tax year 2026, with refunds issued when the credit exceeds tax liability. This would expand the reach of the credit to lower-income families and others with limited tax liability, while also changing the state’s tax code to align more closely with the federal child tax credit framework.
Sentiment
The bill’s stated purpose and framing are strongly supportive of families and children, and the legislative findings emphasize reducing child poverty, helping working families, and improving early childhood outcomes. Because there are no committee transcripts or recorded votes in the provided materials, there is no documented opposition or amendment debate to gauge broader legislative sentiment. Based on the text alone, the measure appears to be presented as a pro-family tax relief proposal with a positive policy rationale.
Contention
The main policy issue embedded in the bill is the shift from a nonrefundable credit to a refundable one, which can increase state revenue costs because taxpayers can receive a refund even when they owe little or no income tax. Another point of potential contention is the repeal of the existing child and dependent care credit, which may affect taxpayers who currently benefit from that structure. Any debate would likely center on fiscal impact, eligibility tied to federal child tax credit rules, and whether the state should prioritize direct refundable relief versus other tax or spending approaches.