Donald Trump Proposes Tax Deduction for Child-Care Costs

By Andrew Ujifusa — August 08, 2016 2 min read
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Cross-posted from Politics K-12

Republican presidential nominee Donald Trump has said he wants to allow parents to deduct the average cost of child care from their federal tax payments.

Trump mentioned the proposal during a speech to the Detroit Economic Club on Monday, the Associated Press reported. Details about the plan have yet to be released, but the candidate’s proposal would appear to be a significant departure from current tax policy governing child-care costs. While the AP said there would be an income limit for eligibility under Trump’s plan, quoting a source with his campaign, the proposal would also scrap the federal Child and Dependent Care tax credit.

The tax deduction, particularly if there is an income cap for those seeking eligibility, would impact disparate income groups differently than a tax-credit program. Typically, higher-income individuals and families are better positioned to take greater advantage of tax deductions than their lower-income counterparts.

Right now, federal tax policy caps the expenses that can be applied to the Child and Dependent Care tax credit at $3,000 for one qualifying individual, and $6,000 for two or more individuals.

The proposal from Trump wouldn’t provide particularly broad benefits, said Laura Bornfreund, the director of early and elementary education policy at the New America Foundation.

“It wouldn’t help our lowest-income families at all and wouldn’t be a ton of help to our middle-income families,” Bornfreund said.

And Trump’s plan addresses just one aspect of child care, she noted; the proposed tax deduction wouldn’t directly address the child-care quality.

Bornfreund is also not sure what it would mean for the deduction to apply to the “average” cost for families.

At the Republican National Convention last month, Trump’s daughter Ivanka Trump indicated that a Trump presidential administration would focus on making child care affordable and accessible. She did not provide more specifics at the time.

Hillary Clinton, Trump’s Democratic opponent, has made expanding access to early-childhood education and broadening child-care options a central component of her presidential bid. One of her first campaign proposals was to work toward universal prekindergarten for all 4-year-olds. She also wants to double the federal government’s roughly $9 billion investment in Head Start, and offer child credits of up to $1,500 for parents who are still in school. And she has pitched significantly expanding home-visiting services for at-risk children.

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Alyson Klein, Assistant Editor contributed to this article.
A version of this news article first appeared in the Early Years blog.