Federal funds set for child care providers across Alabama

MONTGOMERY, Ala. (WSFA) - Child care providers across Alabama are among the many hit hard in the pandemic.

Now, they’re set to get much-needed assistance from the American Rescue Plan.

The plan provides over $450 million from the Child Care Stabilization Fund and over $280 million in flexible funding from the Child Care Development Fund.

In total, over $730 million in federal funding will help child care providers open safely, keep workers on the payroll and lower child care costs for hardworking families.

Alabama District 7 Rep. Terri Sewell says federal guidelines will be in place to determine how much providers can receive once the money is sent to the state.

She says this is an investment in our children and front-line essential workers.

“These funds are critical steps in paving the way for a strong economic recovery and more equitable future for Alabama working families,” Sewell said.

The American Rescue Plan is also expanding the child and dependent care tax credit.

A median-income family in Alabama with two kids under age 13 will receive up to $8,000 towards their child care expenses when they file taxes for 2021, compared with a previous maximum of $1,200.

For the first time, the CDCTC will be fully refundable, making the credit fairer by allowing low-income working families to receive the full value of the credit towards their eligible child care expenses.. regardless of how much they owe on their 2021 taxes.

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