State & Employee Tax Benefits
Employee-based Child Care Options
Federal Tax-Free Payments for Child Care
Beginning in 2026, businesses can set up Dependent Care Assistance Plans, which are flexible spending accounts, that enable employees to set aside up to $7,500 per year in pre-tax salary for child care expenses.
Federal Child and Dependent Care Tax Credit (CDCTC)
When employers send employees their W-2 form at tax time, remind them if they have children for whom they pay for child care services, employees can claim the CDCTC.
New Jersey Parent Child Care Tax Credit
For parents who utilize the federal CDCTC, New Jersey law allows parents a state tax credit for households with income of $150,000 or less. The amount of the credit declines as income rises (and phases out completely for families with income above $150,000). The state tax credit for parents is refundable. Learn more here.
Learn more here
Contact Child Care Resources of Monmouth County
Child Care Resources offers free, personalized assistance to help parents find child care. Parents can search New Jersey’s online database or contact Child Care Resources’ Referral Specialist at (732) 918-9901 or info@ccrnj.org. Expert staff can help parents identify child care options based on family specific needs.