,i #aahth ,,congress #ast ,session ,h4 ,r4 #dega ,,in ,,the ,,house ,,of ,,representatives ,july #ab1 #bjbc ,mr4 ,carbajal 7for himself and ,mrs4 ,chavez-,de,remer7 introduced the following bill2 which was referred to the ,committee on ,ways and ,means ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to expand the employer-provided child care credit and the dependent care assistance exclusion4 #a4 ,short title ,this ,act may be cited as the ,child ,care ,investment ,act of #bjbc4 #b4 ,expansion employer-provided child care credit 7a7 ,increase of amount of qualified child care expenditures taken into account ,section #de;,f7a77#a7 of the ,internal ,revenue ,code of #aihf is amended by striking #be percent and inserting #ej percent4 7b7 ,increase of maximum credit amount ,section #de;,f7b7 of such ,code is amended by striking #aej1jjj and inserting #ejj1jjj4 7c7 ,treatment of jointly owned or operated childcare facility ,section #de;,f7c77#a7 of such ,code is amended by adding at the end the following new subparagraph3 7,c7 ,jointly owned or operated childcare facility ,for purposes of subparagraph 7,a77i77,i71 a qualified childcare facility shall not fail to be treated as being of the taxpayer merely because such facility is jointly owned or operated by the taxpayer and other persons4 4 7d7 ,in-,home childcare service expenses eligible for credit ,section #de;,f7c77#a77;,a77iii7 of such ,code is amended by striking facility and inserting provider4 7e7 ,special rule for small businesses ,section #de;,f7e7 of such ,code is amended by adding at the end the following new paragraph3 7#d7 ,small businesses ,in the case of a taxpayer that meets the gross receipts test of section #ddh7;c71 determined after substituting #e-taxable-year for #c-taxable-year in such section and #e-year for #c-year each place such term appears in paragraph 7#c77;,a7 of such section-- 7,a7 subsection 7a77#a7 shall be applied by substituting #fj percent for #ej percent1 and 7,b7 subsection 7b7 shall be applied by substituting #fjj1jjj for #ejj1jjj4 4 7f7 ,effective date ,the amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this section4 #c4 ,increase in amount excludable for dependent care assistance programs 7a7 ,section #abi7;a77#b77;,a7 of the ,internal ,revenue ,code of #aihf is amended by striking #e1jjj 7#b1ejj and inserting the applicable limitation amount 7half such amount4 7b7 ,section #abi7;a77#b7 of such ,code is amended by adding at the end the following new subparagraph3 7,e7 ,applicable limitation amount ,for purposes of this paragraph1 the term applicable limitation amount means the amount that is the sum of #aj1jjj plus #b1jjj for each individual described in subparagraph 7,a7 or 7,b7 of section #ba7;b77#a7 with respect to such taxpayer4 4 7c7 ,effective date ,the amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this section4 #d4 ,household and dependent care credit increased and made refundable 7a7 ,in general ,subpart ,c of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amending by inserting after section #cf;,b the following new section3 #cf;,c4 ,expenses for household and dependent care services necessary for gainful employment 7a7 ,allowance of credit 7#a7 ,in general ,in the case of an individual for which there are #a or more qualifying individuals with respect to such individual1 there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the applicable percentage of the employment-related expenses paid by such individual during the taxable year4 7#b7 ,applicable percentage defined ,for purposes of paragraph 7#a71 the term applicable percentage means #ej percent reduced 7but not below #ce percent7 by #a percentage point for each #b1jjj 7or fraction thereof7 by which the taxpayer's adjusted gross income for the taxable year exceeds #ae1jjj4 7b7 ,definitions of qualifying individual and employment-,related expenses ,for purposes of this section-- 7#a7 ,qualifying individual ,the term qualifying individual means-- 7,a7 a dependent of the taxpayer 7as defined in section #aeb7;a77#a77 who has not attained age #ac1 7,b7 a dependent of the taxpayer 7as defined in section #aeb1 determined without regard to subsections 7b77#a71 7b77#b71 and 7d77#a77;,b77 who is physically or mentally incapable of caring for himself or herself and who has the same principal place of abode as the taxpayer for more than one-half of such taxable year1 or 7,c7 the spouse of the taxpayer1 if the spouse is physically or mentally incapable of caring for himself or herself and who has the same principal place of abode as the taxpayer for more than one-half of such taxable year4 7#b7 ,employment-related expenses 7,a7 ,in general ,the term employment-related expenses means amounts paid for the following expenses1 but only if such expenses are incurred to enable the taxpayer to be gainfully employed for any period for which there are #a or more qualifying individuals with respect to the taxpayer3 7i7 expenses for household services1 and 7ii7 expenses for the care of a qualifying individual4 ,such term shall not include any amount paid for services outside the taxpayer's household at a camp where the qualifying individual stays overnight4 7,b7 ,exception ,employment-related expenses described in subparagraph 7,a7 which are incurred for services outside the taxpayer's household shall be taken into account only if incurred for the care of-- 7i7 a qualifying individual described in paragraph 7#a77;,a71 or 7ii7 a qualifying individual 7not described in paragraph 7#a77;,a77 who regularly spends at least #h hours each day in the taxpayer's household4 7,c7 ,dependent care centers ,employment-related expenses described in subparagraph 7,a7 which are incurred for services provided outside the taxpayer's household by a dependent care center 7as defined in subparagraph 7,d77 shall be taken into account only if-- 7i7 such center complies with all applicable laws and regulations of a ,state or unit of local government1 and 7ii7 the requirements of subparagraph 7,b7 are met4 7,d7 ,dependent care center defined ,for purposes of this paragraph1 the term dependent care center means any facility which-- 7i7 provides care for more than six individuals 7other than individuals who reside at the facility71 and 7ii7 receives a fee1 payment1 or grant for providing services for any of the individuals 7regardless of whether such facility is operated for profit74 7c7 ,dollar limit on amount creditable ,the amount of the employment-related expenses incurred during any taxable year which may be taken into account under subsection 7a7 shall not exceed-- 7#a7 #c1jjj if there is #a qualifying individual with respect to the taxpayer for such taxable year1 or 7#b7 #f1jjj if there are #b or more qualifying individuals with respect to the taxpayer for such taxable year4 ,the amount determined under paragraph 7#a7 or 7#b7 7whichever is applicable7 shall be reduced by the aggregate amount excludable from gross income under section #abi for the taxable year4 7d7 ,earned income limitation 7#a7 ,in general ,except as otherwise provided in this subsection1 the amount of the employment-related expenses incurred during any taxable year which may be taken into account under subsection 7a7 shall not exceed-- 7,a7 in the case of an individual who is not married at the close of such year1 such individual's earned income for such year1 or 7,b7 in the case of an individual who is married at the close of such year1 the lesser of such individual's earned income or the earned income of his spouse for such year4 7#b7 ,special rule for spouse who is a student or incapable of caring for himself ,in the case of a spouse who is a student or a qualifying individual described in subsection 7b77#a77;,c71 for purposes of paragraph 7#a71 such spouse shall be deemed for each month during which such spouse is a full-time student at an educational institution1 or is such a qualifying individual1 to be gainfully employed and to have earned income of not less than-- 7,a7 #bej if subsection 7c77#a7 applies for the taxable year1 or 7,b7 #ejj if subsection 7c77#b7 applies for the taxable year4 7e7 ,inflation adjustment 7#a7 ,in general ,in the case of any taxable year beginning after #bjbc1 the dollar amounts in this section shall be increased by an amount equal to-- 7,a7 such dollar amount1 multiplied by 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting calendar year #bjbb for calendar year #bjaf in subparagraph 7,a77ii74 7#b7 ,rounding ,if any increase under paragraph 7#a7 is not a multiple of #aj1 such increase shall be rounded to the nearest multiple of #aj4 7f7 ,special rules ,for purposes of this section-- 7#a7 ,place of abode ,an individual shall not be treated as having the same principal place of abode of the taxpayer if at any time during the taxable year of the taxpayer the relationship between the individual and the taxpayer is in violation of local law4 7#b7 ,married couples must file joint return ,if the taxpayer is married at the close of the taxable year1 the credit shall be allowed under subsection 7a7 only if the taxpayer and his spouse file a joint return for the taxable year4 7#c7 ,marital status ,an individual legally separated from his spouse under a decree of divorce or of separate maintenance shall not be considered as married4 7#d7 ,certain married individuals living apart ,if-- 7,a7 an individual who is married and who files a separate return-- 7i7 maintains as his home a household which constitutes for more than one-half of the taxable year the principal place of abode of a qualifying individual1 and 7ii7 furnishes over half of the cost of maintaining such household during the taxable year1 and 7,b7 during the last #f months of such taxable year such individual's spouse is not a member of such household1 such individual shall not be considered as married4 7#e7 ,special dependency test in case of divorced parents1 etc ,if-- 7,a7 section #aeb7;e7 applies to any child with respect to any calendar year1 and 7,b7 such child is under the age of #ac or is physically or mentally incapable of caring for himself1 in the case of any taxable year beginning in such calendar year1 such child shall be treated as a qualifying individual described in subparagraph 7,a7 or 7,b7 of subsection 7b77#a7 7whichever is appropriate7 with respect to the custodial parent 7as defined in section #aeb7;e77#d77;,a771 and shall not be treated as a qualifying individual with respect to the noncustodial parent4 7#f7 ,payments to related individuals ,no credit shall be allowed under subsection 7a7 for any amount paid by the taxpayer to an individual-- 7,a7 with respect to whom1 for the taxable year1 a deduction under section #aea7;c7 7relating to deduction for personal exemptions for dependents7 is allowable either to the taxpayer or his spouse1 or 7,b7 who is a child of the taxpayer 7within the meaning of section #aeb7;f77#a77 who has not attained the age of #ai at the close of the taxable year4 ,for purposes of this paragraph1 the term taxable year means the taxable year of the taxpayer in which the service is performed4 7#g7 ,student ,the term student means an individual who during each of #e calendar months during the taxable year is a full-time student at an educational organization4 7#h7 ,educational organization ,the term educational organization means an educational organization described in section #agj7;b77#a77;,a77ii74 7#i7 ,identifying information required with respect to service provider ,no credit shall be allowed under subsection 7a7 for any amount paid to any person unless-- 7,a7 the name1 address1 and taxpayer identification number of such person are included on the return claiming the credit1 or 7,b7 if such person is an organization described in section #eja7;c77#c7 and exempt from tax under section #eja7;a71 the name and address of such person are included on the return claiming the credit4 ,in the case of a failure to provide the information required under the preceding sentence1 the preceding sentence shall not apply if it is shown that the taxpayer exercised due diligence in attempting to provide the information so required4 7#aj7 ,identifying information required with respect to qualifying individuals ,no credit shall be allowed under this section with respect to any qualifying individual unless the ,,tin of such individual is included on the return claiming the credit4 7g7 ,regulations ,the ,secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section4 4 7b7 ,conforming amendments 7#a7 ,section #acbd7;b7 of title #ca is amended by inserting #cf;,c1 after #cf;,b14 7#b7 ,section #ba of such ,code is repealed4 7#c7 ,section #de;,f7,c77#a77;,a77iv7 of such ,code1 as added by this ,act1 is amended by striking section #ba7;b77#a77;,a7 and inserting section #cf;,c7b77#a77;,a74 7#d7 ,the table of sections for subpart ,a of part ,,iv of subchapter ,a of chapter #a of such ,code is amended by striking the item relating to section #ba4 7#e7 ,section #fbaa7;b77#d77;,a7 of such ,code is amended by striking #ba by reason of subsection 7g7 thereof14 7#f7 ,section #fbac7;g77#b7 of such ,code is amended-- 7,a7 in subparagraph 7,h71 by striking section #ba and inserting section #cf;,c1 and 7,b7 in subparagraph 7,l7-- 7i7 by striking #ba11 and 7ii7 by inserting #cf;,c1 after #cb14 7#g7 ,the following sections of such ,code are each amended by striking section #ba7;e7 and inserting section #cf;,c7e74 7,a7 ,section #bc7;f77#a74 7,b7 ,section #ce7;g77#f74 7,c7 ,section #abi7;a77#b77;,c71 as amended by this ,act4 7#h7 ,section #abi of such ,code is further amended-- 7,a7 in subsection 7b77#b71 by striking section #ba7;d77#b7 and inserting section #cf;,c7d77#b71 and 7,b7 in subsection 7e77#a71 by striking section #ba7;b77#b7 and inserting section #cf;,c7b77#b74 7#i7 ,section #bac7;e7 of such ,code is amended by striking section #ba and inserting section #cf;,c4 7c7 ,clerical amendment ,the table of sections for subpart ,c of part ,,iv of subchapter ,a of chapter #a of such ,code is amended by inserting after the item relating to section #cf;,b the following new item3 ,sec4 #cf;,c4 ,expenses for household and dependent care services necessary for gainful employment4 4 7d7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this section4