SB 654 — creating tax credits for businesses that have on-site child care services and for businesses that provide health care coverage for certain employees.

SB 654-FN - AS INTRODUCEDAMENDED BY THE SENATE 03/05/2026 0829s SESSION 26-3253 07/05 SENATE BILL 654-FN AN ACT creating tax credits for businesses that have on-site child care services and for businesses that provide health care coverage for certain employees.

Ways and Means ───────────────────────────────────────────────────────────────── AMENDED ANALYSIS This bill creates tax credits against the business profits tax for businesses that have on-site child care services and for businesses that provide health care coverage for certain employees.

This bill also makes an appropriation to the department of revenue administration for improvements and system upgrades to the revenue information management system.

SB 654-FN - AS INTRODUCEDAMENDED BY THE SENATE 03/05/2026 0829s 26-3253 07/05 STATE OF NEW HAMPSHIRE In the Year of Our Lord Two Thousand Twenty-Six AN ACT creating tax credits for businesses that have on-site child care services and for businesses that provide health care coverage for certain employees.

There shall be allowed an on-site child care services tax credit,credit for eligible businesses, according to the following:

(a) The credit shall be equal to 20 percent of qualifying expendituresexpenditures, tiedas todefined runningin on-26 siteU.S.C. or nearby child care services for employees, up to $100,000 per fiscal year.

(b)section The45F, departmenttied of health and human services shall establish rules, pursuant to RSAoperating 541-A,or tocontracting determinefor whaton-site expendituresor arenearby "qualifyingchild expenditures"care andservices what the fair market value of such expenditures for purposesemployees, ofup calculatingto the$100,000 creditper underfiscal thisyear. paragraph.

(c)(b) An eligible business shall have its child care service facility for its employees housed within the business' main building, inside a shared building where both the business and child care facility are located, or in separate buildings within the same office or industrial park.park, or within 1/4 of a mile of the above.

(d)(c) Unused tax credits may be rolledcarried overforward into the next fiscal year, for up to 4 years.

Older credits shall be rolledutilized over first.

(e)(d) A business that receives a credit under this paragraph shall be required to pay backany alltax not paid due to credits received if it closes aan on-site child care facility within 3 years of receiving a credit and continues to maintain its primary business operations at the same address.address no later than the tax year following the closure.

(f)(e) The department of revenuehealth administrationand mayhuman waiveservices and the recapturedepartment of creditsrevenue awardedadministration undermay subparagraphshare (e)information inabout casesfacility ofclosures businesswithout saleswaiving orany estateother transfersapplicable ofconfidentiality businessrules assets.or requirements.

The(f) departmentUpon maywritten establishrequest rules,made pursuantprior to RSAthe 541-A,filing regardingof the waiverapplicable oftax return, the recapturecommissioner may waive the repayment of creditstax awardednot underpaid subparagraphdue (e)to credits in othercircumstances where a child care facility is closed due to no fault of the business that received the credits or due to circumstances asbeyond itthe seescontrol fit.of the business that received the credit.

(g)Factors Anywhich businessthe thatdepartment sharesshould aconsider childin caredetermining facilitywhether and seeks to claimwaive the creditrepayment underobligation this paragraph shall provideinclude proofthe duration of athe qualifyingclosure contractualif agreementtemporary, of the usereason offor the sharedclosure facilityas tostated by the departmentrequestor, priorand tothe claimingimpact of the creditclosure underupon thisthe paragraph.employees.

(g) Businesses that share a group child day care center may jointly claim the on-site child care services tax credit under this paragraph.

A joint application shall include a qualifying contractual agreement of the use of the shared facility to the department prior to claiming the credit SB 654-FN - AS AMENDED BY THE SENATE - Page 2 - under this paragraph.

(h) Taxpayers shall apply for the tax credit on forms provided by the commissioner and applications shall be accompanied by information or records required by the commissioner.

Applications shall be processed in the order received, and shall be approved or denied within 60 days of receipt.

If an application is denied, the commissioner shall notify the taxpayer of the reason or reasons for the denial.

(i) The aggregate of all on-site child care services tax credits issued by the commissioner shall not exceed $2,500,000 in any state fiscal year.

Applications received in a fiscal year that exceed the aggregate limit for that year may be considered and granted for the succeeding fiscal year or years and shall receive priority over subsequently filed applications in applying the aggregate cap for that fiscal year.

(j) The department may adopt rules pursuant to RSA 541-A regarding the procedure for applying for the credit and the procedure for applying for waiver of the repayment obligation.

(a) The credit shall be equal to 20 percent of the employer's cost of health care benefits,benefits upconferred to $10,000each perparent fiscalhours year per employee, conferredup to each$10,000 eligibleper year per employee.

SB 654-FN - AS INTRODUCED - Page 2 - (b) As used in subparagraph (a), "eligible"parent hours employee" means an employee with at least one dependent child whose working hours fall entirely between 9:00 a.m.

2(c) EffectiveAny Date.costs of health care benefits included as a qualifying expenditure for purposes of the on-site child care tax credit under paragraph XVIII shall be ineligible for the parent hours tax credit.

2 Appropriation;

Department of Revenue Administration.

There is hereby appropriated to the department of revenue administration the sum of $40,000 for the fiscal year ending June 30, 2028, for the purpose of making internal improvements and system upgrades to the department's revenue information management system.

The governor is authorized to draw a warrant for said sums out of any money in the treasury not otherwise appropriated.

3 ApplicabilitySection 1 of this act shall apply to taxable periods beginning on or after December 31, 2027.

4 Effective Date.

LBA 26-3253 1/28/2603/13/2026 SB 654-FN- FISCAL NOTE AS INTRODUCEDAMENDED BY THE SENATE (AMENDMENT #2026-0829s) AN ACT creating tax credits for businesses that have on-site child care services and for businesses that provide health care coverage for certain employees.

DueThis tobill timedoes constraints,not the Office of Legislative Budget Assistant is unable to provide afunding, fiscalnor notedoes forit thisauthorize billnew atpositions. this time.

WhenEstimated completed,State theImpact fiscalFY note2026 willFY be2027 forwardedFY 2028 FY 2029 Revenue $0 $0 Indeterminable Indeterminable Decrease Decrease Revenue Fund(s) General Fund and Education Trust Fund Expenditures* $0 $0 $40,000 $0 Funding Source(s) General Fund Appropriations* $0 $0 $40,000 $0 Funding Source(s) General Fund *Expenditure = Cost of bill *Appropriation = Authorized funding to thecover Senatecost Clerk'sof Office.bill METHODOLOGY:

This bill creates a new on-site child care services tax credit against the Business Profits Tax (BPT) for employer businesses who have child care services for employees.

The on-site child care services tax credit shall be equal to 20% of qualifying expenses up to $100,000 per fiscal year with any unused tax credits available for up to 4 years.

Multiple businesses may share a child care facility and each is able to claim the on-site child care services tax credit.

The aggregate of all on-site child care services tax credits issued shall not exceed $2,500,000 in any fiscal year.

If a business closes a child care facility within 3 years of receiving a credit and continues to maintain its primary business operations at the same address, they will be required to pay back all credits received, unless the Commissioner of the Department of Revenue Administration determines the closure was due to no fault or beyond control of the business that received the credit.

This bill also establishes the parent hours tax credit against the BPT for employers who permit those with at least one dependent child to work not more than 9:00 a.m.