NC S857

Reenacts the child care tax credit (G.S. 105-151.11) as it existed before expiration and recodifies it as G.S. 105-153.11.

Allows taxpayers who claim a federal income tax credit for employment-related expenses under Section 21 of the Internal Revenue Code to claim a corresponding North Carolina state tax credit based on an applicable percentage.

Tax credit percentages vary by filing status and adjusted gross income, ranging from 7% to 13% (Percentage A for dependents age 7+) and 10% to 13% (Percentage B for other qualifying individuals).

Limits the amount of employment-related expenses for which credit may be claimed to $3,000 for one qualifying individual or $6,000 for more than one qualifying individual, reduced by any employer-provided dependent care assistance excluded from gross income.

Effective for taxable years beginning on or after January 1, 2022.