FISCAL NOTE
Date Requested: January 28, 2026
Time Requested: 03:21 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 3156 |
Introduced |
SB621 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
Summarize in a clear and concise manner what impact this measure will have on costs and revenues of state government.
The stated purpose of this bill is to provide a tax credit against the state corporate net income tax and the state personal income tax for expenditures related to the operation of existing employer-provided or sponsored child-care facilities.
Under current Law, the State provides a 50 percent tax credit for capital investment in a qualified employer-provided childcare facility and a 50 percent tax credit for operating costs of employer provided or employer sponsored childcare costs net of any amounts paid for by employees. Both West Virginia and the Federal Government also offer additional deductions for flexible childcare spending accounts and a child and dependent care expense tax credit. This bill would create another alternative qualified employer-provided or employer sponsored childcare cost tax credit equal to 100 percent of costs net of any amounts paid for by employees. We would expect the few large employer Taxpayers currently participating in the current 50 percent tax credit program to opt for the enhanced 100 percent State paid program relating to families already receiving childcare benefits with most credits going to large non-profit employers who are able to transfer their tax credits to other Taxpayers. We are unable to able to fully quantify the longer-term impact of this new 100 percent State funded benefit for a few large employers, but the cost would be of some significance. There would be additional incentives toward the greater transfer of all childcare related costs to the State given the increase to 100 percent subsidy.
Additional administrative costs incurred by the State Tax Department would be $22,000 in FY2027 and $11,000 per year in FY2028 and thereafter.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2026
Increase/Decrease
(use"-") |
2027
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
22,000 |
11,000 |
| Personal Services |
0 |
0 |
11,000 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
22,000 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
Please explain increases and decreases in personal services, current expenses, repairs and alterations, assets, other costs and revenues, including assumptions and data sources and delineation between start-up and ongoing costs. Please also include a long-range schedule of costs and revenues if fiscal impact is expected to vary in future years.
Under current Law, the State provides a 50 percent tax credit for capital investment in a qualified employer-provided childcare facility and a 50 percent tax credit for operating costs of employer provided or employer sponsored childcare costs net of any amounts paid for by employees. Both West Virginia and the Federal Government also offer additional deductions for flexible childcare spending accounts and a child and dependent care expense tax credit. This bill would create another alternative qualified employer-provided or employer sponsored childcare cost tax credit equal to 100 percent of costs net of any amounts paid for by employees. We would expect the few large employer Taxpayers currently participating in the current 50 percent tax credit program to opt for the enhanced 100 percent State paid program relating to families already receiving childcare benefits with most credits going to large non-profit employers who are able to transfer their tax credits to other Taxpayers. We are unable to able to fully quantify the longer-term impact of this new 100 percent State funded benefit for a few large employers, but the cost would be of some significance. There would be additional incentives toward the greater transfer of all childcare related costs to the State given the increase to 100 percent subsidy.
Additional administrative costs incurred by the State Tax Department would be $22,000 in FY2027 and $11,000 per year in FY2028 and thereafter.
Memorandum
Please identify any areas of vagueness, technical defects, reasons a bill would not have a fiscal impact, and/or any special issues not captured elsewhere on this form.
The stated purpose of this bill is to provide a tax credit against the state corporate net income tax and the state personal income tax for expenditures related to the operation of existing employer-provided or sponsored child-care facilities.
This bill references the two existing statutory provisions and apparently sets the new provisions as alternatives to the current provisions since the bill disqualifies a taxpayer from claiming the credit provided in proposed §11-21-98 and §11-24-45, if the taxpayer qualifies for or claims the tax credit “for the cost of operation for such qualified child-care property” currently provided in §11-21-97 and §11-24-44. It is not clear whether both the subsection (a) and (e) credits set forth in the pre-existing sections are included in this language, since the pre-existing sections also set forth a capital improvement credit.
Person submitting Fiscal Note: Mark Muchow
Email Address: radfiscal@wv.gov