How Much Will Child Care Cost Under Trump's Tax Plan? New Estimations Look A Lot Better
Do we have Ivanka to thank for this? For once, it seems like families might have been taken into account in one of President Donald Trump's proposed policies. So, really, how much will child care cost under Trump's tax plan? Is there actually a tax cut for families with little ones?
Huge disclaimer: The details of the cut really aren't at all ironed out yet. If you're looking for a final amount, one doesn't exist yet; Things are purely speculative at this point. But these ideas are definitely grounded in fact, as a briefing on the proposed plan shared, back in April, that "families in this country will also benefit from tax relief to help them with child and dependent care expenses." Regardless, we're on the right track.
What can families expect, then? The Washington Post reveals that, according to a senior administration official, the assistance will come in the form of the Child and Dependent Care Tax Credit, which currently allows for $2,100 in tax exemptions dedicated to a family's child care budget. "Trump is reportedly drafting a proposal that would raise the maximum value of the credit," Slate insists, "with a cap on how much wealthier families can benefit." What's more, the credit could also be refundable, which would increase the benefits for lower-income families.
This plan is a definite improvement to Trump's previous one, which relied on income tax deductions, and would ultimately best serve members of higher income brackets. "Lower-income families often don’t have a federal income tax burden," The Washington Post explains, "and so wouldn’t have received much of a benefit under the plan." So, whereas it was once estimated that middle-income families would receive a whopping $20 max in child care deductions, this is no longer the case.
All of this surely sounds like good news, but it really depends on how high Trump is willing to let the tax credit get. Child care costs exceed college tuition estimates, reports show, so a minimal increase in the current tax credit wouldn't help families — especially low-income ones — out in a significant way at all. Child care costs are more than rent or food, and the numbers are rising. Thus, one would hope government policies would work to keep up, addressing the needs of its people, so that children are properly care for and their parents are able to get to work.
Whereas many advocacy groups note that increasing the tax credit is a start, more adjustments still need to be made, as gaps in assistance to child care access are plenty. As the child care expenses caveat exists as a small piece of a much larger budget puzzle, more explanation is needed before we all get our hopes up.