IN HB1177

Expands Indiana's employer child care tax credit eligibility from businesses with 100 or fewer employees to those with 500 or fewer employees, effective January 1, 2026 (retroactive)

Broadens qualified child care expenditures to include operating costs, employee training, scholarship programs, increased compensation for trained staff, contracts with child care facilities or intermediaries for employee services, and child care resource/referral services

Removes the requirement that taxpayers must directly operate the child care facility and eliminates recapture provisions that previously required repayment of credits if facilities closed or enrolled non-employee children within five years

Authorizes redevelopment commissions to use tax increment financing (TIF) allocation funds to provide grants, loans, and financial assistance for construction, expansion, or ongoing operation of child care facilities in or serving allocation areas

Declares an emergency for immediate effect, with child care tax credit changes applying to taxable years beginning after December 31, 2025