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SB 2282

AN ACT to create and enact a new section to chapter 57-38 and new subdivision to subsection 7 of section 57-38-30.3 of the North Dakota Century Code, relating to an income tax credit for child care contributions provided by qualified employers; and to provide an effective date.

69th Legislative Assembly (2025-26) Introduced by Kathy Hogan and 4 co-sponsors

North Dakota offers a nonrefundable 50% employer tax credit on child care contributions, capped at $1,000 per employee ($500 max credit), effective for 2025+ tax years.

Filed with Secretary Of State 05/01
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Bill Summary · SB 2282

SB 2282 — Child Care Contribution Income Tax Credit (North Dakota) — Summary

Status: Enacted (Filed with Secretary of State 05/01/2025; Governor signed 04/30/2025)
Effective date: Taxable years beginning after December 31, 2024

Purpose

Create an employer-level income tax credit to encourage employer contributions that subsidize employee child care costs by reducing the employer’s North Dakota income tax liability.

Key provisions

  • Credit amount
    • A “qualified employer” is allowed a credit equal to 50% of its aggregate child care contributions paid during the taxable year.
    • “Aggregate child care contributions” are capped at the first $1,000 of contributions per qualified employee; therefore the effective maximum credit per employee is $500.
  • Claiming and limitations
    • The credit must be claimed for the taxable year in which the child care contributions are made.
    • The credit is nonrefundable: it may not exceed the taxpayer’s income tax liability, and any excess cannot be carried back or forward.
    • Pass‑through entities compute the credit at the entity level; the determined total credit is then allocated to partners/shareholders/members in proportion to their ownership interests.
    • Tax Commissioner required to provide forms and procedures for claiming the credit.
  • Eligibility and definitions (selected)
    • Qualified employer: an employer that (1) made a child care contribution during the taxable year and (2) provided an equal opportunity for all employees with child care costs to receive an equal child care contribution during the year.
    • Qualified employee: an individual employed by the qualified employer claiming the credit.
    • Child care contribution: a payment by the employer to a child care provider or a reimbursement to an employee to subsidize child care costs incurred to enable employment.
    • Child care provider: an early childhood services provider licensed under chapter 50‑11.1 (NDCC).
  • Administrative
    • A new subdivision references this credit within section 57‑38‑30.3 (income taxation code).
    • Effective for tax years beginning after Dec. 31, 2024.

Who is affected

  • Employers in North Dakota that provide child care contributions or reimbursements to employees (including pass‑through entities).
  • Employees receiving such employer subsidies (indirectly benefit through increased employer support for child care).
  • State tax administration (Tax Commissioner) for implementation and compliance oversight.

Potential impacts and considerations

  • Incentivizes employers to subsidize employee child care by partially offsetting employer tax liability.
  • Fiscal effect: reduces state income tax revenue to the extent employers claim the credit; actual cost depends on employer uptake and number of qualifying employees.
  • The “equal opportunity” requirement may restrict employers from offering the benefit to only a subset of employees.
  • Because the credit is nonrefundable and not carryable, employers with little or no ND income tax liability may receive limited benefit.

Legislative/procedural timeline (selected)

  • Introduced: March 11, 2025 (ND Senate)
  • Conference committee and amendments adopted in April 2025
  • Passed both chambers (Senate and House) in April 2025
  • Signed by President of the Senate, Speaker of the House; Governor signed April 30, 2025
  • Filed with Secretary of State: May 1, 2025

If you want, I can produce a one-line plain‑language summary for public distribution or estimate the maximum possible credit an employer could claim under different employee counts.

Compiled from official sources — confirm details with the bill’s official record.

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