Section 1 Short title
This Act may be cited as the “Child and Dependent Care Tax Credit Enhancement Act of 2015”.
Child and Dependent Care Tax Credit Enhancement Act of 2015
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.
Sec. 2 Enhancement of Child and Dependent Care Tax Credit
In general— Paragraph (2) of section 21(a) of the Internal Revenue Code of 1986 is amended to read as follows:
“(2) Applicable percentage—For purposes of paragraph (1), the term applicable percentage means—
“(A) in the case of employment-related expenses incurred for the care of a qualifying individual who has not attained 5 years of age before the close of the taxable year, 50-percent reduced (but not below 20 percent) by 1 percentage point for each $2,000 (or fraction thereof) by which the taxpayer's adjusted gross income for the taxable year exceeds $120,000, and
“(B) in the case of any employment-related expenses which are not described in subparagraph (A), 35-percent reduced (but not below 20 percent) by 1 percentage point for each $2,000 (or fraction thereof) by which the taxpayer's adjusted gross income for the taxable year exceeds $120,000.”
Increase in dollar limit on amount creditable— Paragraphs (1) and (2) of section 21(c) of such Code are amended to read as follows:
“(1) in the case of 1 qualifying individual with respect to the taxpayer for such taxable year—
“(A) if such qualifying individual has attained 5 years of age before the close of the taxable year, $3,000, or
“(B) if such qualifying individual has not attained 5 years of age before the close of the taxable year, $6,000, or
“(2) in the case of 2 or more qualifying individuals with respect to the taxpayer for such taxable year—
“(A) if 1 of such qualifying individuals has not attained 5 years of age before the close of the taxable year, $9,000, or
“(B) if 2 or more of such qualifying individuals have not attained 5 years of age before the close of the taxable year, $12,000.”
Adjustment for inflation— Section 21 of such Code is amended—
by redesignating subsection (f) as subsection (g), and
by inserting after subsection (e) the following new subsection:
“(f) Inflation adjustment
“(1) In general—In the case of a calendar year beginning after 2016, the $120,000 dollar amounts in subparagraphs (A) and (B) of subsection (a)(2) and the dollar amounts in subsection (c) shall each be increased by an amount equal to—
“(A) such dollar amount, multiplied by
“(B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “calendar year 2015” for “calendar year 1992” in subparagraph (B) thereof.
“(2) Rounding—If any dollar amount, after being increased under paragraph (1), is not a multiple of $100, such dollar amount shall be rounded to the next lowest multiple of $100.”
Credit To Be Refundable—
In general— The Internal Revenue Code of 1986 is amended—
by redesignating section 21 as section 36C, and
by moving section 36C, as so redesignated, from subpart A of part IV of subchapter A of chapter 1 to the location immediately before section 37 in subpart C of part IV of subchapter A of chapter 1.
Technical amendments—
Paragraph (1) of section 23(f) of the Internal Revenue Code of 1986 is amended by striking “21(e)” and inserting “36C(e)”.
Paragraph (6) of section 35(g) of such Code is amended by striking “21(e)” and inserting “36C(e)”.
Paragraph (1) of section 36C(a) of such Code (as redesignated by paragraph (1)) is amended by striking “this chapter” and inserting “this subtitle”.
Subparagraph (C) of section 129(a)(2) of such Code is amended by striking “section 21(e)” and inserting “section 36C(e)”.
Paragraph (2) of section 129(b) of such Code is amended by striking “section 21(d)(2)” and inserting “section 36C(d)(2)”.
Paragraph (1) of section 129(e) of such Code is amended by striking “section 21(b)(2)” and inserting “section 36C(b)(2)”.
Subsection (e) of section 213 of such Code is amended by striking “section 21” and inserting “section 36C”.
Subparagraph (H) of section 6213(g)(2) of such Code is amended by striking “section 21” and inserting “section 36C”.
Subparagraph (L) of section 6213(g)(2) of such Code is amended by striking “section 21, 24, or 32,” and inserting “section 24, 32, or 36C,”.
Paragraph (2) of section 1324(b) of title 31, United States Code, is amended by inserting “36C,” after “36B,”.
The table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 36B the following:
The table of sections for subpart A of such part IV is amended by striking the item relating to section 21.
Effective date— The amendments made by this section shall apply to taxable years beginning after December 31, 2015.