Child and Dependent Care Tax Credit Enhancement Act of 2025

[Congressional Bills 119th Congress] [From the U.S. Government Publishing Office] [H.R. 2994 Introduced in House (IH)] <DOC> 119th CONGRESS 1st Session H. R. 2994 To amend the Internal Revenue Code of 1986 to enhance the Child and Dependent Care Tax Credit and make the credit fully refundable for certain taxpayers. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES April 24, 2025 Mr. Davis of Illinois (for himself, Ms. DelBene, Ms. Sanchez, Mr. Beyer, Ms. Moore of Wisconsin, Ms. Chu, Ms. Sewell, Mr. Boyle of Pennsylvania, Ms. McCollum, Ms. Brownley, Mr. Larson of Connecticut, Ms. Wilson of Florida, Ms. Norton, Mr. Cleaver, Mr. Carson, Mr. Khanna, Mr. Connolly, and Mr. Panetta) introduced the following bill; which was referred to the Committee on Ways and Means _______________________________________________________________________ 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 for certain taxpayers. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Child and Dependent Care Tax Credit Enhancement Act of 2025''. SEC. 2. ENHANCEMENT OF CHILD AND DEPENDENT CARE TAX CREDIT. (a) In General.--Paragraph (2) of section 21(a) of the Internal Revenue Code of 1986 is amended to read as follows: ``(2) Applicable percentage.-- ``(A) In general.--For purposes of paragraph (1), the term `applicable percentage' means 50 percent reduced (but not below the phaseout percentage) by 1 percentage point for each $2,000 (or fraction thereof) by which the taxpayer's adjusted gross income for the taxable year exceeds $125,000. ``(B) Phaseout percentage.--For purposes of subparagraph (A), the term `phaseout percentage' means 20 percent reduced (but not below zero) by 1 percentage point for each $2,000 (or fraction thereof) by which the t