The cost of child care is an issue for many Vermont families within a wide range of income levels.
Child Care Financial Assistance Program
The Child Care Financial Assistance Program can help your family pay for child care if you have an accepted need for the care, meet the income guidelines, and live in Vermont.
Child Tax Benefits
There are several federal and state tax credits that can reduce your taxes and free up money for child care. You may qualify if you work, have children living with you, and meet the income guidelines.
If you have an accountant, ask if you qualify for any of the tax credits below. If you do your own taxes, find out if you qualify for free tax preparation services from your local community action agency or through the IRS's Volunteer Income Tax Assistance.
Child and Dependent Care Credit
You may be able to claim this tax credit if you paid expenses for the care of a qualifying individual to enable you — and your spouse, if filing a joint return — to work or actively look for work.
Earned Income Tax Credit (EITC)
You may be eligible for this tax credit if your income is low to moderate. If you qualify, you can use it to reduce the taxes you owe and maybe increase your refund.
Vermont offers tax relief to employees who have dependent care expenses so they can stay in the workforce. You have two options. You cannot use them both.
Child and Dependent Care Expenses Tax Credit
If you are eligible for the federal Child and Dependent Care Credit, you qualify for the state tax credit. The credit amount is 24% of the federal Child and Dependent Care Tax Credit.
Other Help With Child Care Costs
- Ask your child care provider if they offer any scholarships or rates based on the ability to pay.
- Ask your employer if they offer any help.