OMB No. 1545-1809 Credit for Employer-Provided Childcare

Facilities and Services

Form 8882

Department of the Treasury

Internal Revenue Service

Name(s) shown on return Identifying number

For Paperwork Reduction Act Notice, see back of form. Cat. No. 33436Y Form 8882 (Rev. 12-2006)

Attachment

© Attach to your tax return. Sequence No.131

1

2 2

3

5

Qualified childcare facility expenditures paid or incurred

3

5

Enter the smaller of line 6 or $150,000. Estates and trusts, go to line 8. All others report this

amount as follows: partnerships and S corporations, report this amount on Schedule K; all others,

report the credit on the applicable line of Form 3800, (e.g., line 1n of the 2006 Form 3800)

Enter 25% (.25) of line 1

4

1

Add lines 2, 4, and 5

Qualified childcare resource and referral expenditures paid or incurred

Enter 10% (.10) of line 3

6

7

6

7

4

Credit for employer-provided childcare facilities and services from partnerships, S corporations, 

estates, and trusts

(Rev. December 2006)

8 Amount allocated to beneficiaries of the estate or trust (see instructions)

Estates and trusts. Subtract line 8 from line 7. Report the credit on the applicable line of Form

3800 (e.g., line 1n of the 2006 Form 3800)

9

8

9

Purpose of Form

Employers use Form 8882 to claim the credit for qualified

childcare facility and resource and referral expenditures. The

credit is part of the general business credit. You may claim

the credit any time within 3 years from the due date of your

return on either an original or amended return.

How To Figure the Credit

The credit is 25% of the qualified childcare facility

expenditures plus 10% of the qualified childcare resource

and referral expenditures paid or incurred during the tax year.

The credit is limited to $150,000 per tax year.

Qualified childcare expenditures are amounts paid or

incurred:

● To acquire, construct, rehabilitate, or expand property that:

1. Is to be used as part of a qualified childcare facility of

the taxpayer,

2. Is depreciable (or amortizable) property, and

3. Is not part of the principal residence of the taxpayer or

any employee of the taxpayer;

● For the operating expenses of a qualified childcare facility

of the taxpayer, including expenses for training of employees,

scholarship programs, and providing increased compensation

to employees with higher levels of childcare training; or

● Under a contract with a qualified childcare facility to

provide childcare services to employees of the taxpayer.

Note. Any expenses for childcare included in qualified

childcare facility expenditures may not exceed the fair market

value of such care.

A qualified childcare facility is a facility that meets the

requirements of all applicable laws and regulations of the

state or local government in which it is located, including the

licensing of the facility as a childcare facility. The following

conditions must also be met.

● The principal use of the facility must be to provide

childcare (unless the facility is also the personal residence of

the person operating the facility).

● Enrollment in the facility must be open to employees of the

taxpayer during the tax year.

General Instructions

Section references are to the Internal Revenue Code.

What’s New

● The IRS will revise this December 2006 version of the form

only when necessary. Continue to use this version for tax

years beginning after 2005 until a new revision is issued.

● The tax liability limit is no longer figured on this form.

Instead, it must be figured on Form 3800, General Business

Credit.

● Taxpayers that are not partnerships, S corporations,

estates, or trusts, and whose only source of this credit is

from those pass-through entities, are not required to

complete or file this form. Instead, they can report this credit

directly on line 1n of Form 3800.

For details, see section 45F.
Form 8882 (Rev. 12-2006) Page 2

● The use of the facility (or the eligibility to use the facility)

must not discriminate in favor of highly compensated

employees.

Qualified childcare resource and referral expenditures are

amounts paid or incurred under a contract to provide

childcare resource and referral services to employees of the

taxpayer. The provision of the services (or the eligibility to

use the services) must not discriminate in favor of highly

compensated employees.

No Double Benefit Allowed

You must reduce:

Recapture of Credit

You may have to recapture part or all of the credit if, before

the 10th tax year after the tax year in which your qualified

childcare facility is placed in service, the facility ceases to

operate as a qualified childcare facility or there is a change in

ownership of the facility. However, a change in ownership will

not require recapture if the person acquiring the interest in

the facility agrees, in writing, to assume the recapture liability.

See section 45F(d) for details.

Member of Controlled Group or Business

Under Common Control

For purposes of figuring the credit, all members of a

controlled group of corporations (as defined in section 52(a))

and all members of a group of businesses under common

control (as defined in section 52(b)), are treated as a single

taxpayer. As a member, compute your credit for lines 2 and

4 as follows:

Specific Instructions

Any recapture tax is reported on the line of your tax return

where other recapture taxes are reported (or, if no such line,

on the “total tax” line). The recapture tax may not be used in

figuring the amount of any credit or in figuring the alternative

minimum tax.

● The basis of any qualified childcare facility by the amount

of the credit on line 7 allocable to capital expenditures

related to the facility,

● Any otherwise allowable deductions used to figure the

credit by the amount of the credit on line 7 allocable to those

deductions, and

● Any expenditures used to figure any other credit by the

amount of the credit on line 7 allocable to those expenditures

(for purposes of figuring the other credit).

Note. For credits entered on line 5, only the pass-through

entity is required to make this reduction.

● If the facility is the principal trade or business of the

taxpayer, at least 30% of the enrollees of the facility must be

dependents of employees of the taxpayer.

If you have comments concerning the accuracy of these

time estimates or suggestions for making this form simpler,

we would be happy to hear from you. See the instructions for

the tax return with which this form is filed.

Recordkeeping 2 hr., 37 min.

Learning about the law

or the form 30 min.

Preparing and sending

the form to the IRS 34 min.

The time needed to complete and file this form will vary

depending on individual circumstances. The estimated

burden for individual taxpayers filing this form is approved

under OMB control number 1545-0074 and is included in the

estimates shown in the instructions for their individual

income tax return. The estimated burden for all other

taxpayers who file this form is shown below.

Paperwork Reduction Act Notice. We ask for the

information on this form to carry out the Internal Revenue

laws of the United States. You are required to give us the

information. We need it to ensure that you are complying

with these laws and to allow us to figure and collect the right

amount of tax.

You are not required to provide the information requested

on a form that is subject to the Paperwork Reduction Act

unless the form displays a valid OMB control number. Books

or records relating to a form or its instructions must be

retained as long as their contents may become material in

the administration of any Internal Revenue law. Generally, tax

returns and return information are confidential, as required by

section 6103.

Estates and trusts. Allocate the credit for employer-provided

childcare facilities and services on line 7 between the estate or

trust and the beneficiaries in the same proportion as income

was allocated, and enter the beneficiaries’ share on line 8.

Line 8

● Compute your credit for line 2 based on your proportionate

share of qualified childcare facility expenditures giving rise to

the group’s credit for line 2. Enter your share of the credit on

line 2. Attach a statement showing how your share of the

credit was figured, and write “See Attached” next to the

entry space for line 2.

● Compute your credit for line 4 based on your proportionate

share of qualified resource and referral expenditures giving

rise to the group’s credit for line 4. Enter your share of the

credit on line 4. Attach a statement showing how your share

of the credit was figured, and write “See Attached” next to

the entry space for line 4.