KLS Keeping Law Simple Legislation in plain English

Straight-ahead summaries built from the official bill text. We keep the source links front and center and leave the decision up to you.

Back to California

AB-2673 • 2026

Personal Income Tax Law: Corporation Tax Law: credit: childcare.

Personal Income Tax Law: Corporation Tax Law: credit: childcare.

Taxes
Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor
Celeste Rodriguez
Last action
2026-04-20
Official status
In committee: Set, first hearing. Referred to REV. & TAX. suspense file.
Effective date
Not listed

Plain English Breakdown

The official source does not specify if there is a requirement for annual reporting by businesses and individuals.

Childcare Credit for Taxes

AB-2673 allows businesses and individuals to get a tax credit of up to $100,000 each year from 2027 to 2031 if they help pay for childcare.

What This Bill Does

  • Creates a new tax credit that helps people who pay for childcare.
  • Limits the credit to 50% of what someone spends on childcare, up to $100,000 per year.
  • Includes goals and ways to measure if the tax credit is working well.

Who It Names or Affects

  • Businesses that pay for or support childcare expenses.
  • Individuals who pay for childcare services.

Terms To Know

Tax Credit
A reduction in the amount of tax someone has to pay, based on certain activities or expenses.
Qualified Contributions
Money spent by businesses and individuals that counts towards getting a tax credit for childcare costs.

Limits and Unknowns

  • The bill only applies from January 1, 2027 to December 31, 2031.
  • It is not clear how many people or businesses will take advantage of this new tax credit.

Bill History

  1. 2026-04-20 California Legislative Information

    In committee: Set, first hearing. Referred to REV. & TAX. suspense file.

  2. 2026-03-16 California Legislative Information

    Referred to Com. on REV. & TAX.

  3. 2026-02-21 California Legislative Information

    From printer. May be heard in committee March 23.

  4. 2026-02-20 California Legislative Information

    Read first time. To print.

Official Summary Text

AB 2673, as introduced, Celeste Rodriguez.
Personal Income Tax Law: Corporation Tax Law: credit: childcare.
The Personal Income Tax Law and the Corporation Tax Law allow various credits against the taxes imposed by those laws.
This bill would allow a credit against those taxes for each taxable year beginning on or after January 1, 2027, and before January 1, 2032, in an amount equal to 50% of qualified contributions to promote childcare, up to $100,000, as specified.
Existing law requires any bill authorizing a new tax expenditure, as defined, to include tax credits, to contain, among other things, specific goals, purposes, and objectives that the tax credit will achieve, detailed performance indicators, and data collection requirements.
This bill would include findings and reporting requirements in compliance with this requirement.
This bill would take effect immediately as a tax levy.

Current Bill Text

Read the full stored bill text 
Download Bill PDF