Access to reliable child care remains a major workforce challenge for Kansas employers and working families. With the passage of Senate Bill 82, signed into law on April 27, 2026, the state is expanding an existing employer child care expenses credit and introducing a new community child care contributions credit. Effective January 1, 2027, the incentives support employee child care needs and help community organizations expand child care availability.
The expanded Employer Child Care Expenses Credit allows businesses to claim a tax credit for qualified expenses tied to child care benefits for employees. Eligible expenses may include:
- Paying for employee child care
- Establishing or expanding employer-sponsored child care programs
- Funding referral services that connect employees with providers
- Participating in collaborative child care investments with other employers
Businesses may claim a credit equal to 75% of qualifying expenses incurred in Kansas during the tax year.
The new Community Child Care Contributions Credit encourages businesses to support organizations that expand access to child care services. Qualifying contributions may support:
- Child care program development
- Licensing efforts
- Educational materials and equipment
- Professional development for child care staff
- Tuition assistance for families
- Referral services for locating care
Businesses can receive a credit of 75% of eligible contributions when the recipient organization serves families receiving childcare subsidies, or 50% when it does not.
Eligibility and Considerations
Several limitations apply to these credits. Child care facilities and providers must be properly licensed under Kansas law, and the total credit available to any taxpayer is capped at $100,000 per year across both credits combined. Qualified expenses and contributions must be incurred beginning January 1, 2027, with credits available for the 2027 tax year and beyond. Unused credits may be carried forward for up to three years. The legislation also establishes an annual statewide cap of $3 million in credits claimed under the program.
Together, the expanded employer credit and new community contribution credit reflect Kansas’s commitment to strengthening the child care infrastructure while helping employers address workforce challenges. By reducing the cost of investing in child care solutions, the legislation creates opportunities for businesses to support working families and foster stronger communities across the state.
Ready to explore what this could mean for your organization? Connect with a Pinion advisor to evaluate eligibility, identify qualifying expenses, and prepare for the 2027 effective date.
Disclaimer: Consult your tax advisor to evaluate eligibility and determine how these credits may apply to your specific circumstances.
