An Act to Expand Child Care Services Through an Employer-supported Tax Credit
Maine Legislature, Session 131, LD 1222
Committee: Taxation
Sponsors: STEWART, BENNETT, JACKSON, VITELLI, MILLETT, TERRY
Amends: 36 MRSA §5217, 36 MRSA §5217-G

Legislative Document
No. 1222
S.P. 503
In Senate, March 21, 2023
An Act to Expand Child Care Services Through an Employer-
supported Tax Credit
Reference to the Committee on Taxation suggested and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by Senator STEWART of Aroostook.
Cosponsored by Senators: BENNETT of Oxford, President JACKSON of Aroostook, 
VITELLI of Sagadahoc, Representatives: MILLETT of Waterford, TERRY of Gorham.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §5217, as amended by PL 2015, c. 267, Pt. DD, §22, is repealed.
Sec. 2.  36 MRSA §5217-G is enacted to read:
§5217-G.  Employer supported quality child care
1.  Definitions. As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings.
A.  "Employing unit" has the same meaning as in Title 26, section 1043, subsection 10.
B.  "Providing child care services" means expending funds or providing in-kind 
resources to build, furnish, license, staff, operate or subsidize a child care center 
licensed by the Department of Health and Human Services to provide early care and 
education services to children of employees of the employing unit at no profit to the 
employing unit or to contract with a child care facility licensed by or registered with 
the department to provide early care and education services to children of employees 
of the employing unit. "Providing child care services" includes payments made by an 
employing unit to an employee for purposes of paying for early care and education 
services for children of the employee under a dependent care assistance program and 
the provision of child care resource and referral services to employees.
2.  Credit allowed for quality child care expenses. For tax years beginning on or after 
January 1, 2024, an employing unit is allowed a refundable credit against the tax otherwise 
due under this Part for each tax year in an amount equal to the lower of:
A.  Fifty percent of the costs of providing child care services; or
B.  Three thousand dollars for each child of an employee of the employing unit for 
which the employing unit is providing child care services.
3.  Carry-over. Any unused credit may be carried over to the following year or years 
not to exceed 15 years.
4.  Evaluation; specific public policy objectives. Beginning in 2028, the credit 
provided under this section is subject to ongoing legislative review in accordance with Title 
3, chapter 37. In developing evaluation parameters to perform the review, the Office of 
Program Evaluation and Government Accountability shall consider whether the specific 
public policy objectives and economic benefit of the credit provided under this section 
outweigh the loss of revenue to the State.
SUMMARY
This bill repeals the law governing the employer-assisted day care income tax credit, 
which by its own terms does not apply to tax years beginning on or after January 1, 2016.  
The bill authorizes a refundable tax credit for an employer that pays or provides in-kind 
resources for child care for the children of its employees. The amount of the annual credit 
is 50% of the amount expended or $3,000 per child, whichever is lower.