SECTION 1 (TITLE):
This act shall be known as the Childcare Advance Act.
SECTION 2 (PURPOSE):
This act amends the tax law to establish a “Childcare Advance” which enables certain taxpayers to defer payment of a portion of their tax liability.
SECTION 3 (PROVISIONS):
(a) Any resident taxpayer who, in a taxable year, has employment-related expenses for childcare for a dependent under age five, may defer payment of their tax liability for that taxable year under this article by the amount of those expenses but not to exceed two thousand dollars.
(b) Any taxpayer who defers tax liability under subdivision (a) of this section shall be liable: (i) once the taxpayer is no longer taking the deferral, for the full amount previously deferred divided into equal payments over ten years, except that (ii) in any future years the taxpayer takes the deferral, that taxpayer is liable only for one-tenth of each deferral taken five or more years prior until each of those deferrals is repaid. At no point shall the taxpayer be liable for amounts previously repaid. Repayment shall be made without interest.
(c) At the end of every tax year, the Tax Department shall notify each taxpayer who has deferred tax liability under subdivision (a) of this section of the total amount of their deferred liability, the tax year in which repayment will begin, and an estimate of the amount for which the taxpayer will be liable each year once the eligibility expires.
(d) Nothing in this section shall prevent a taxpayer from repaying accumulated liability earlier than the schedule set forth in subdivision (b) of this section, or taking less than the total amount allowable under subdivision (a) of this section in any given tax year.
(e) Any taxpayer that moves to a jurisdiction that does not maintain tax reciprocity with the state, shall be liable for the entire amount deferred on the tax filing for the tax year in which such change of residence occurs, but subject to approval of the Department shall be directed to repay that liability through a payment plan approved by the Department.
(f) The Department shall provide for the repayment of deferrals under this section to be made through payroll withholding, and shall address repayment in cases of divorce.