AL SB280

Creates three childcare incentive programs effective January 1, 2025 through December 31, 2029: employer tax credit (up to $1,000,000 per employer annually), facility tax credit (up to $25,000 per facility annually), and nonprofit childcare provider grants (up to $50,000 per provider annually).

Employer tax credit aggregate caps increase annually from $15,000,000 (2025) to $35,000,000 (2029); facility tax credit capped at $5,000,000 annually; nonprofit grants capped at $5,000,000 annually.

Facility tax credit amounts vary by childcare quality rating from $1,000 per eligible child (1-star) to $2,000 per eligible child (5-star) based on Alabama Quality STARS program ratings.

Requires Department of Revenue to reserve at least 25 percent of employer and facility tax credits for small businesses and rural areas; requires Department of Human Resources to reserve 25 percent of nonprofit grants for rural providers.

Establishes Childcare Tax Credit Account within Education Trust Fund to pay refunds when tax credits exceed applicable taxes owed; restricts tax credit transfers and requires priority funding for employees eligible for earned income tax credit.