II 

117TH CONGRESS 

1ST SESSION S. 271 

To amend the Internal Revenue Code of 1986 to enhance the Child and 

Dependent Care Tax Credit and make the credit fully refundable. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 8, 2021 

Mr. CASEY (for himself, Mr. WYDEN, Mrs. MURRAY, Mr. MENENDEZ, Mr. 

CARDIN, Mr. BROWN, Mr. BENNET, Mr. WHITEHOUSE, Ms. HASSAN, Ms. 

CORTEZ MASTO, Ms. STABENOW, Ms. CANTWELL, Ms. SMITH, Mr. 

BLUMENTHAL, Mr. MURPHY, Mr. DURBIN, Ms. HIRONO, Mr. LEAHY, 

Ms. KLOBUCHAR, Mr. BOOKER, Mr. REED, Ms. BALDWIN, Mrs. GILLIBRAND, Mr. HEINRICH, Mr. MERKLEY, Mr. VAN HOLLEN, Ms. 

DUCKWORTH, and Mr. LUJA ́N) introduced the following bill; which was 

read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to enhance 

the Child and Dependent Care Tax Credit and make 

the credit fully refundable. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Child and Dependent 

5 Care Tax Credit Enhancement Act of 2021’’. 


pamtmann on DSKBC07HB2PROD with BILLS
2 

•S 271 IS

1 SEC. 2. ENHANCEMENT OF CHILD AND DEPENDENT CARE 

2 TAX CREDIT. 

3 (a) IN GENERAL.—Paragraph (2) of section 21(a) of 

4 the Internal Revenue Code of 1986 is amended to read 

5 as follows: 

6 ‘‘(2) APPLICABLE PERCENTAGE.— 

7 ‘‘(A) IN GENERAL.—For purposes of para8 graph (1), the term ‘applicable percentage’ 

9 means 50 percent reduced (but not below the 

10 phaseout percentage) by 1 percentage point for 

11 each $2,000 (or fraction thereof) by which the 

12 taxpayer’s adjusted gross income for the taxable 

13 year exceeds $125,000. 

14 ‘‘(B) PHASEOUT PERCENTAGE.—For pur15 poses of subparagraph (A), the term ‘phaseout 

16 percentage’ means 20 percent reduced (but not 

17 below zero) by 1 percentage point for each 

18 $2,000 (or fraction thereof) by which the tax19 payer’s adjusted gross income for the taxable 

20 year exceeds $400,000.’’. 

21 (b) INCREASE IN DOLLAR LIMIT ON AMOUNT CRED22 ITABLE.—Subsection (c) of section 21 of the Internal Rev23 enue Code of 1986 is amended— 

24 (1) in paragraph (1), by striking ‘‘$3,000’’ and 

25 inserting ‘‘$8,000’’; and 


pamtmann on DSKBC07HB2PROD with BILLS
3 

•S 271 IS

1 (2) in paragraph (2), by striking ‘‘$6,000’’ and 

2 inserting ‘‘$16,000’’. 

3 (c) SPECIAL RULE FOR MARRIED COUPLES FILING

4 SEPARATE RETURNS.—Paragraph (2) of section 21(e) of 

5 the Internal Revenue Code of 1986 is amended to read 

6 as follows: 

7 ‘‘(2) MARRIED COUPLES FILING SEPARATE RE8 TURNS.— 

9 ‘‘(A) IN GENERAL.—In the case of married 

10 individuals who do not file a joint return for the 

11 taxable year— 

12 ‘‘(i) the applicable percentage under 

13 subsection (a)(2) and the number of quali14 fying individuals and aggregate amount ex15 cludable under section 129 for purposes of 

16 subsection (c) shall be determined with re17 spect to each such individual as if the indi18 vidual had filed a joint return with the in19 dividual’s spouse, and 

20 ‘‘(ii) the aggregate amount of the 

21 credits allowed under this section for such 

22 taxable year with respect to both spouses 

23 shall not exceed the amount which would 

24 have been allowed under this section if the 

25 individuals had filed a joint return. 


pamtmann on DSKBC07HB2PROD with BILLS
4 

•S 271 IS

1 ‘‘(B) REGULATIONS.—The Secretary shall 

2 prescribe such regulations or other guidance as 

3 is necessary to carry out the purposes of this 

4 subsection.’’. 

5 (d) ADJUSTMENT FOR INFLATION.—Section 21 of 

6 the Internal Revenue Code of 1986 is amended— 

7 (1) by redesignating subsection (f) as sub8 section (g); and 

9 (2) by inserting after subsection (e) the fol10 lowing new subsection: 

11 ‘‘(f) INFLATION ADJUSTMENT.— 

12 ‘‘(1) IN GENERAL.—In the case of a calendar 

13 year beginning after 2022, the $125,000 amount in 

14 paragraph (2) of subsection (a) and the dollar 

15 amounts in subsection (c) shall each be increased by 

16 an amount equal to— 

17 ‘‘(A) such dollar amount, multiplied by 

18 ‘‘(B) the cost-of-living adjustment deter19 mined under section 1(f)(3) for the calendar 

20 year in which the taxable year begins, deter21 mined by substituting ‘calendar year 2021’ for 

22 ‘calendar year 2016’ in subparagraph (A)(ii) 

23 thereof. 

24 ‘‘(2) ROUNDING.—If any dollar amount, after 

25 being increased under paragraph (1), is not a mulVerDate Sep 11 2014 17:05 Feb 21, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S271.IS S271

pamtmann on DSKBC07HB2PROD with BILLS
5 

•S 271 IS

1 tiple of $100, such dollar amount shall be rounded 

2 to the next lowest multiple of $100.’’. 

3 (e) CREDIT TO BE REFUNDABLE.— 

4 (1) IN GENERAL.—The Internal Revenue Code 

5 of 1986 is amended— 

6 (A) by redesignating section 21 as section 

7 36C; and 

8 (B) by moving section 36C, as so redesig9 nated, from subpart A of part IV of subchapter 

10 A of chapter 1 to the location immediately be11 fore section 37 in subpart C of part IV of sub12 chapter A of chapter 1. 

13 (2) TECHNICAL AMENDMENTS.— 

14 (A) Paragraph (1) of section 23(f) of the 

15 Internal Revenue Code of 1986 is amended by 

16 striking ‘‘21(e)’’ and inserting ‘‘36C(e)’’. 

17 (B) Paragraph (6) of section 35(g) of such 

18 Code is amended by striking ‘‘21(e)’’ and in19 serting ‘‘36C(e)’’. 

20 (C) Paragraph (1) of section 36C(a) of 

21 such Code (as redesignated by paragraph (1)) 

22 is amended by striking ‘‘this chapter’’ and in23 serting ‘‘this subtitle’’. 


pamtmann on DSKBC07HB2PROD with BILLS
6 

•S 271 IS

1 (D) Subparagraph (C) of section 129(a)(2) 

2 of such Code is amended by striking ‘‘section 

3 21(e)’’ and inserting ‘‘section 36C(e)’’. 

4 (E) Paragraph (2) of section 129(b) of 

5 such Code is amended by striking ‘‘section 

6 21(d)(2)’’ and inserting ‘‘section 36C(d)(2)’’. 

7 (F) Paragraph (1) of section 129(e) of 

8 such Code is amended by striking ‘‘section 

9 21(b)(2)’’ and inserting ‘‘section 36C(b)(2)’’. 

10 (G) Subsection (e) of section 213 of such 

11 Code is amended by striking ‘‘section 21’’ and 

12 inserting ‘‘section 36C’’. 

13 (H) Subparagraph (H) of section 

14 6213(g)(2) of such Code is amended by striking 

15 ‘‘section 21’’ and inserting ‘‘section 36C’’. 

16 (I) Subparagraph (L) of section 

17 6213(g)(2) of such Code is amended by striking 

18 ‘‘section 21, 24, or 32,’’ and inserting ‘‘section 

19 24, 32, or 36C,’’. 

20 (J) Paragraph (2) of section 1324(b) of 

21 title 31, United States Code, is amended by in22 serting ‘‘36C,’’ after ‘‘36B,’’. 

23 (K) The table of sections for subpart C of 

24 part IV of subchapter A of chapter 1 of the In25 ternal Revenue Code of 1986 is amended by inVerDate Sep 11 2014 17:05 Feb 21, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S271.IS S271

pamtmann on DSKBC07HB2PROD with BILLS
7 

•S 271 IS

1 serting after the item relating to section 36B 

2 the following: 

‘‘Sec. 36C. Expenses for household and dependent care services necessary for 

gainful employment.’’. 

3 (L) The table of sections for subpart A of 

4 such part IV is amended by striking the item 

5 relating to section 21. 

6 (f) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply to taxable years beginning after 

8 December 31, 2021. 

Æ 


pamtmann on DSKBC07HB2PROD with BILLS