Child Care Refundable Tax Credit
Neb. Rev. Stat. §§ 77-7201 to 77-7205 Child Care Tax Credit Act (Act)
*LB 754 (Sections 1 through 5, Operative for taxable years beginning on or after January 1, 2024.)
LB 208 (Sections 4 & 8, Operative September 3, 2024)
The Child Care Tax Credit Act (Act) established a refundable tax credit for parents and legal guardians who are residents of the State of Nebraska for tax years beginning on or after January 1, 2024.
Parents or legal guardians may submit the Child Care Refundable Tax Credit Application, Form 7203, using the Nebraska Department of Revenue’s (DOR) Electronic Document & Application Submission Hub (eDASH). Applying for the refundable child care tax credit is fast, easy, and secure using the eDASH portal. Click the eDASH link below to apply. Parents and legal guardians must apply for the tax credit and receive approval confirmation from DOR prior to claiming the credit on their Nebraska individual income tax return.
eDASH Update: Application submission for Form 7203 is currently closed. DOR will publicize on our website the date that applications for the 2025 tax year will be available for submission. Submissions will not be available until late January. Sign up for a free subscription service at DOR’s website to receive email updates regarding the applications availability.
Instructions to Apply for the Tax Credit
Child Care Refundable Tax Credit Application Required Information
Parents or legal guardians of children 5 years old or younger may apply to DOR to receive a refundable tax credit if their total houshold income is $150,000 or less. To qualify, the child must be age 5 years or younger as of December 31 of the calendar year (i.e., under age 6) for which the tax credit is being requested and must be claimed by the parent or legal guardian as a dependent for federal income tax purposes. Example: Your child turned 6 on December 30, 2025, and is claimed as a dependent on your return. You cannot use the child to claim the child care refundable tax credit for 2025 because the child was not under age 6 at the end of 2025.
The parent or legal guardian who is claiming the child for federal income tax purposes is eligible for the refundable tax credit if they are a resident of Nebraska and:
- If the child is enrolled in a child care program licensed pursuant to the Child Care Licensing Act *; or
- If the child receives care from an approved license-exempt provider enrolled in the child care subsidy program pursuant to Neb. Rev. Stat. §§ 68-1202 and 68-1206; or
- If the parent’s or legal guardian’s total household income is less than or equal to 100% of the federal poverty level. **
* A program also qualifies if it is not required to be licensed under the Child Care Licensing Act because the program is operated or contracted by a public school district and subject to the rules and regulations of the Nebraska Department of Education pursuant to Neb. Rev. Stat § § 71-1910 and 71-1916(4).
** If the parent’s or legal guardian’s total household income is not less than or equal to 100% of the federal poverty level, the child must have attended a child care program licensed by DHHS, attended an approved license-exempt provider enrolled in the child care subsidy program, or attended a program that is not required to be licensed because it is operated or contracted by a public school district for the child to qualify under the Act.
The credit will equal:
- $2,000 per child, if the total household income is no more than $75,000; or
- $1,000 per child, if the total household income is more than $75,000 but no more than $150,000.
If the total household income is more than $150,000, the parent or legal guardian is not eligible for the child care refundable tax credit.
Total household income means federal modified adjusted gross income.
The parent’s or legal guardian’s application and supporting documentation will be used to certify the refundable tax credit. The applications will be used to reserve the tax credits for the individual to claim on their Nebraska individual income tax return. The applications will be processed in the order received until the annual limit reaches $15 million. Use the eDASH link above to submit the Child Care Refundable Tax Credit Application.
Any approved, reserved credit amount may be reduced or disallowed if any information provided in the application does not match the actual information reported on your Nebraska individual income tax return when claiming the credit.
Tax Credit Authorization Table
***Reminder: The Form 7203 will be electronically submitted using the eDASH link above. This application method is fast, easy, and secure.***
