Today, the First Five Years Fund (FFYF), together with 11 child care providers and Save the Children Action Network, sent a letter to U.S. Senate Finance Committee Chairman Orrin Hatch (R-Utah), along with his colleagues on the Committee, urging Congress to ensure its tax reform bill incentivizes investment in high-quality early childhood education programs.

The letter, which was sent in response to the Chairman’s call for comments on tax reform, encourages the Finance Committee to consider policies that expand access for low- and middle-income families struggling to afford quality child care across America.

“Members of Congress have the opportunity to leverage tax reform to improve access to high-quality early learning and child care for working families in every state across the nation,” said FFYF Executive Director Kris Perry. “We look forward to continuing to work with Chairman Hatch, the Senate Finance Committee, and all policymakers to ensure any efforts in Congress to reform the nation’s tax code will expand access to high-quality child care opportunities, particularly for children from low-income families.”

While tax reform is one tool for improving access to high-quality early childhood education, we must continue investing in high-quality, evidence-based federal programs like Head Start and the Child Care Development Block Grants program to support children’s healthy development and school readiness.

Access to affordable, reliable, high-quality early learning and care is critically important for the economic stability and prosperity of working families and the nation. The availability of quality child care plays a crucial role in helping parents both obtain and retain employment, enabling parents to earn a living while their children are in a healthy and safe learning environment developing the skills they need to succeed in life.

The years from birth through age five are essential for a child’s brain and physical development, and high-quality early learning and care is foundational to that development. However, access to these high-quality programs is often outside the reach of many families, challenging parents’ ability to reliably attend work and maintain employment. This reality harms not only families themselves, but the economy at large. As the letter states, employee absenteeism due to child care issues causes U.S. businesses to lose $3 billion annually.

As the Senate Finance Committee works to update the nation’s outdated tax code, FFYF and partnering organizations recommend Congress pursue policies that reach low- and middle-income families, focus on the quality of child care, and incentivize and leverage private sector resources to make tax reform work for children, families, and taxpayers. The letter was submitted just two days prior to Wednesday’s House Ways and Means Committee hearing entitled “How Tax Reform Will Simplify Our Broken Tax Code and Help Individuals and Families.”

Key priorities outlined in the letter to Chairman Hatch include:

  • Reaching Low- and Middle-Income Families: To address rising costs and limited access for low- and middle-income families, FFYF recommends the Senate Finance Committee prioritize expanding the Child and Dependent Care Tax Credit, indexing expense thresholds to inflation, and making the credit refundable.
  • Focusing on the Quality of Child Care: To increase the quality of child care services available to families, FFYF recommends the Senate Finance Committee offer a tax credit to child care center directors and teachers for completing certification training; the letter also calls for expanding the definition of the Educator Expense Deduction to include early childhood education teachers.
  • Incentivizing and Leveraging Private Sector Resources: To increase private sector investment in providing access to early learning programs, FFYF recommends that tax reform include tax credits for employer-provided child care facilities, expand the definition of qualified institutions for tax-free education scholarships, and increase limits of the Dependent Care Assistance Program.

The full letter to Senator Hatch can be found online here:

More information about child care tax proposals can be found online here:

Additional letter signatories include:

  • Bright Horizons Family Solutions
  • Childcare Network
  • Children’s Discovery Center
  • Early Care and Education Consortium
  • The Goddard School
  • KinderCare Education
  • Learning Care Group
  • New Horizon Academy
  • Primrose Schools
  • Save the Children Action Network
  • Teaching Strategies
  • Teachstone

The First Five Years Fund provides knowledge, data, and advocacy – persuading federal policymakers to make investments in the first five years of a child’s life that create greater returns for all. FFYF helps America achieve better results in education, health, and economic productivity through investments in quality early childhood education programs for disadvantaged children.