Child Tax Credit: Pennsylvania Residents Could See 30% of Child Care Expenses Returned

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Since the enhanced federal child tax credit (CTC) reverted to its original maximum amount of $2,000 per child for 2022, similar initiatives by the U.S. government have stalled to the point of being declared “dead” by critics.

In response, many states have begun to introduce their own child tax credit programs, varying in scope and available credit amount. Pennsylvania now joins 12 other states providing relief though state-legislated child tax credits or deductions. 

Pennsylvania Governor Tom Wolf has recently signed off on the state’s new $45.2 billion budget, which includes a child tax credit program among other numerous spending initiatives.

Designed with the federal CTC in mind, the Pennsylvania Child and Dependent Care Enhancement Program enables families to receive tax breaks for child care expenses at a value of 30% of the federal credit. Eligibility depends on income, but the announcement did not specific income details of the plan — though it is expected to mirror federal child tax credit income eligibility.    

The state is using $24.6 million to fund to the program, which is now a permanent part of the Pennsylvania tax code, according to WITF. Pennsylvania residents who care for one dependent can claim a maximum of $3,000 — and for those with two or more dependents, the maximum is $6,000.

The new budget increases spending by 2.9% over the 2021-22 budget and also includes a one-time 70% property tax rebate for seniors, funding for gun violence intervention and a $250,000 boost for the “It’s On Us PA” program, a statewide campaign that invites everyone to play a role in ending sexual assault, according to the Pittsburgh City Paper.

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