Remember back in 2021 when everyone in the US with kids got an extra few hundred dollars every month, and a few hundred more in their 2021 tax return? And then research showed that policy – the expanded federal child tax credit – cut child poverty by 46%? We thought that was pretty great!
While Congress has not brought back that expanded credit (yet), and the Nebraska Legislature has not followed the trend of other states creating robust state-level Child Tax Credits (yet), Nebraska does have a new Child Care Tax Credit that is an exciting step in that direction. This new tax credit put $15 million back into the hands of Nebraskans with children in 2024, and will do the same in 2025. You can read more about the new tax credit – including a description of who is eligible and how to apply – here. The Department of Revenue started accepting applications for the 2025 tax year Child Care Tax Credit on January 26, 2026 via an online portal here.
Help get the word out!
The most exciting part of this tax credit (in terms of reducing child poverty) is that the credit is available to families whose income is at or below 100% of the federal poverty level – regardless of whether their children were enrolled in child care or cared for at home. While this tax credit would be helpful for all parents and caregivers, let’s work together to make sure the Nebraska families who need this the most have a chance to get it.
Share this information!
- We’ve put together two short videos explaining the basics about who is eligible and how to apply. NOTE: The videos reference tax year 2024 – this information is the same for tax year 2025. The only major change is the date the application portal opened (January 26, 2026 instead of January 2, 2025). Additionally, this tax credit was previously referred to as a tax credit for “Working Parents” in some resources. This caused some confusion around who could claim the credit, and we appreciate the shift in the language.
- Keep an eye out for updates on the Child Care Tax Credit campaign website.
- Also keep an eye out for updates on the Nebraska Department of Revenue website:
- Nebraska Free Legal Answers – If you have a specific question about whether you’re eligible for this tax credit and how to apply, use this website to ask an attorney for help.
When you share that information, make sure to highlight these points:
- The sooner you submit an application after January 26, 2026, the better your chances are of receiving the credit before the available dollars run out. Applications will be approved on a “first come, first served” basis, and there is a $15 million cap on the tax credit. The only way to “get in line” is to submit an application on that portal (and have it approved). Last year, the Nebraska Department of Revenue received over $22 million in applications for this tax credit, and it is likely that the demand will exceed the available funding again this year.
- If your household income this year is closer to $150,000 than it is to $50,000, please consider waiting to apply. This will hopefully give lower-income families a chance to claim this credit before the funds run out. Or, if you are on the higher end of that income spectrum and you’re able to receive this tax credit, consider supporting a local mutual aid effort in your community.
Care work is important work, no matter how much or how little you get paid for it! So let’s make this new tax credit for parents and guardians work for all of us.
