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S4014
SENATE, No. 4014
STATE OF NEW JERSEY
222nd LEGISLATURE
�
INTRODUCED MARCH 19, 2026
Sponsored by:
Senator� JOSEPH F. VITALE
District 19 (Middlesex)
SYNOPSIS
���� Allows gross income tax credit for certain child care
staff and registered family day care providers.
CURRENT VERSION OF TEXT
���� As introduced.
��
An Act
allowing a gross income tax credit for certain
child care providers and �supplementing Title 54A of New Jersey Statutes.
����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:
���� 1.��� The Legislature finds
and declares that:
���� a.���� Even before the start
of the coronavirus disease 2019 (COVID-19) pandemic, New Jersey�s child care
industry struggled to find and retain teaching staff due to chronically low
wages paid to child care employees.�
���� b.��� Since the COVID-19 pandemic,
child care programs throughout New Jersey are not only losing teachers and
assistant teachers but are struggling to find qualified staff to take their
places.
���� c.���� Over the last year, the
responsibilities of child care teachers have become increasingly demanding and
complex, yet many child care programs cannot afford to compensate their
teachers above a minimum wage.
���� d.��� While the Department of
Human Services has increased State child care subsidy rates and continues to
pay child care programs based on the number of children enrolled rather than
attendance, the State�s child care system has been inadequately funded for so
long that any additional financial assistance is often not reflected in
augmented wages for child care program staff.
���� e.���� Without sufficient
staffing, child care programs cannot adequately care for and educate the number
of children needing care, which directly impacts their parents� ability to
participate in the workforce.
���� f.���� In order to address the
State�s child care staffing crisis and to ensure the continued success of child
care programs and the teaching staff who care for, educate, and support the
low-income families, it is in the best interest of the State to provide direct
relief to financially struggling child care program employees.
���� 2.� a.� A credit against the
tax otherwise due for the taxable year under the �New Jersey Gross Income Tax
Act,� N.J.S.54A:1-1 et seq., shall be allowed on the New Jersey gross income of
any staff member working for a child care provider, licensed pursuant to the
�Child Care Center Licensing Act,� P.L.1983, c.492 (C.30:5B 1 et seq.), who
directly supervise children as defined in N.J.A.C. 3A:52-4.3 and any family day
care provider, registered by a family day care sponsoring organization pursuant
to the �Family Day Care Provider Registration Act,� P.L.1987, c.27 (C.30:5B-16
et seq.), who has been employed by a licensed child care provider or worked as
a registered family day care provider in their current position for a continuous
six month period during the taxable year.
���� b.� (1) For a staff member
working for a child care provider who directly supervises children or
registered family day care provider with an individual gross income:
���� �(a) of less than $25,000, the
amount of the credit shall be equal to $1,000 for providing child care services
to children 30 months of age or older, and $1,500 for providing child care
services to children from birth to the age of 30 months;
���� �(b) between $25,000 and
$35,000, the amount of the credit shall be equal to $750 for providing child
care services to children 30 months of age or older, and $1,000 for providing
child care services to children from birth to the age of 30 months; and
���� (c) between $35,001 and
$45,000, the amount of the credit shall be equal to $500 for providing child
care services to children 30 months of age or older, and $750 for providing
child care services to children from birth to the age of 30 months.
���� (2) The amount of credit
allowed on the gross income of a staff member working for a child care provider
who directly supervises children or registered family day care provider for
providing child care services to children from birth to the age of 30 months
shall only apply to a staff member or provider who spends at least 50% of the
classroom teacher�s or provider�s employment time providing such services.
���� c.� (1)� For a staff member
working for a child care provider who directly supervises children and
registered family day care provider who has a gross income for the taxable year
of less than $45,000: if the amount of credit allowed pursuant to this section
for the taxable year, together with any other payments or credits against the
tax, reduces the tax liability otherwise due for the taxable year to zero, any
amount of credit remaining shall be paid to the taxpayer as a refund of an
overpayment of tax pursuant to N.J.S.54A:9-7, provided that subsection (f) of
N.J.S.54A:9-7 shall not apply.
���� (2)� For a staff member
working for a child care provider who directly supervises children and
registered family day care provider who has a gross income for the taxable year
of $45,000: if the amount of credit allowed pursuant to this section for the
taxable year, together with any other payments or credits against the tax,
reduces the tax liability otherwise due for the taxable year to zero, any
amount of credit remaining shall be carried forward to the next taxable year.
No portion of a credit shall carry forward to more than the next taxable year
following the year in which the credit is first allowed.
���� d.��� The order of priority of
the application of the credit allowed pursuant to this section and any other
credits allowed against the gross income tax for the taxable year shall be as
prescribed by the Director of the Division of Taxation in the Department of the
Treasury.
���� e.���� A credit allowed
pursuant to this section shall not be taken into account as income or receipts
for purposes of determining the eligibility of a taxpayer for benefits or
assistance or the amount or extent of benefits or assistance under any State
program and, to the extent permitted by federal law, under any State program
financed in whole or in part with federal funds.
���� 3.��� This act shall take
effect immediately and apply to taxable years beginning January 1 next
following enactment.
STATEMENT
���� This bill allows a gross
income tax credit for staff members employed by a licensed child care provider
who directly supervise children and for registered family day care providers
who, as applicable, have been employed by a child care provider or worked as a
registered family day care provider for a continuous six month period during
the taxable year.
���� The credit amount varies
depending on the staff member�s or registered family day care provider�s
income:� (1) for incomes of less than $25,000, the amount of the credit will be
equal to $1,000 for providing child care services to children 30 months of age
or older, and $1,500 for providing child care services to children from birth
to the age of 30 months; (2) for incomes between $25,000 and $35,000, the
amount of the credit will be equal to $750 for providing child care services to
children 30 months of age or older, and $1,000 for providing child care
services to children from birth to the age of 30 months; and (3) for incomes
between $35,001 and $45,000, the amount of the credit will be equal to $500 for
providing child care services to children 30 months of age or older, and $750
for providing child care services to children from birth to the age of 30
months.
���� For staff members working for
a child care provider who directly supervise children and for registered family
day care providers who provide child care services to children from birth to
the age of 30 months, the tax credit will only apply if the staff member or
family day care provider spends at least 50% of the staff member�s or family
day care provider�s employment time providing such services.
���� For staff members and
registered family day care providers with less than $45,000 of gross income,
the credit is refundable:� if the staff member or provider has no tax liability
to against which the credit may be applied, the staff member or provider will
receive the remaining credit amount from the State in cash.� For a staff member
or provider with an income of $45,000, any remaining credit may be carried
forward to the next taxable year, but may not be carried forward beyond that.
���� The credit allowed by this
bill cannot be taken into account as income or receipts for the purposes of
determining the eligibility of a taxpayer for benefits or assistance or for the
purposes of determining the amount or extent of benefits or assistance under
any State benefits or assistance program, including programs financed in whole
or in part with federal funds.