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Arkansas Code Title 26. Taxation § 26-51-502. Household and dependent care expenses

Current as of March 28, 2024 | Updated by Findlaw Staff

(a) A credit shall be allowed to individuals against the income tax imposed by the Income Tax Act of 1929, § 26-51-101 et seq., for expenses for household and dependent care services necessary for gainful employment in the manner prescribed by subsection (b) of this section.

(b)(1) Title 26 U.S.C. § 21, as in effect on January 2, 2013, is adopted for purposes of determining the allowable credit under the Income Tax Act of 1929, § 26-51-101 et seq., for household and dependent care services necessary for gainful employment.

(2) The amount of credit shall be twenty percent (20%) of the federal credit allowable.

(c)(1)(A)(i) A credit, which is equal to twenty percent (20%) of the federal childcare credit as allowed under 26 U.S.C. § 21, as in effect on January 2, 2013, shall be allowed to qualified individuals against the income tax imposed by the Income Tax Act of 1929, § 26-51-101 et seq.

(ii) The twenty-percent childcare credit is refundable.

(iii) The excess of the credit over tax liability will be returned to the taxpayer as an overpayment of tax.

(B) “Qualified individual” means a taxpayer who has a dependent child with respect to whom the taxpayer is entitled to a credit under § 26-51-501(a)(3), and who incurs childcare expenses necessary for gainful employment at an approved childcare facility, as defined in subdivision (c)(1)(C) of this section.

(C) “Approved childcare facility” means a childcare facility which provided an appropriate early childhood program, as defined in § 6-45-103, and which is approved in accordance with § 6-45-109.

(2) A taxpayer cannot claim both the credit allowed in subsections (a) and (b) of this section and the credit allowed in subsection (c) of this section.

(3) The credit allowed in this subsection shall be effective for taxable years beginning January 1, 2013.

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Cite this article: FindLaw.com - Arkansas Code Title 26. Taxation § 26-51-502. Household and dependent care expenses - last updated March 28, 2024 | https://codes.findlaw.com/ar/title-26-taxation/ar-code-sect-26-51-502/

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