An income tax credit is available to a taxpayer that is an employer which makes qualified child care contributions for its employees. The credit may be earned by employer payments made directly to child care facilities or to employees for reimbursement of their child care costs for qualified child care. The employer must provide an equal opportunity for all its employees with child care costs to participate.
Qualifications
Qualified payments include those made to child care facilities licensed in North Dakota and payments to licensed facilities located within ten miles of North Dakota. There is no limit on the amount of tax credit that may be earned for any tax year. The credit is nonrefundable, and any credit earned in excess of a taxpayer’s tax liability may not be carried over to succeeding tax years. A tax credit earned by a passthrough entity is passed through and allowed to each owner in proportion to their respective interests in the passthrough entity.
Credit Amounts
The tax credit is equal to 50% of an employer’s aggregate qualified child care payments made during the tax year. The tax credit is available for the first $1,000 of payments to or attributable to each employee.
Application Process
Not Applicable.
How to Claim
If you're filing as a/an: | Claim the credit on: |
| Individual or Sole Proprietor | Schedule ECC, Employer Child Care Contribution Credit |
| C Corporation | Form 40, Corporation Income Tax Return Schedule ECC |
| S Corporation | Form 60, S Corporation Income Tax Return Schedule ECC |
| Partnership | Form 58, Partnership Income Tax Return Schedule ECC |
| Fiduciary | Form 38, Fiduciary Income Tax Return Schedule ECC |