HB1021
To Create The Early Childhood Education Workforce Quality Incentive Act; And To Create An Income Tax Credit For Certain Early Childhood Education Workers.
Last Action (May 5, 2025): Died in House Committee at Sine Die adjournment.
Sponsors
AI-Generated Summary
House Bill 1021, titled the 'Early Childhood Education Workforce Quality Incentive Act,' proposes a refundable income tax credit for qualifying early childhood education professionals in Arkansas. To be eligible, directors, teachers, and instructional staff must work in programs meeting the 'Better Beginnings' quality rating standards and earn less than the state's minimum salary for K-12 public school teachers. The bill establishes a tiered tax credit system based on educational credentials and certifications, ranging from $1,800 to $3,000. Specifically, those with a Child Development Associate certification or an Administrator Credential qualify for $1,800; those with an associate degree qualify for $2,400; and those with a bachelor's degree or higher qualify for $3,000. If the credit exceeds a taxpayer's liability, the remaining balance is refundable. Taxpayers must provide an attestation form from the Arkansas Professional Development Registry to claim the credit. The provisions of the act apply to tax years beginning on or after January 1, 2025.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are early childhood education workers, including teachers, directors, and instructional staff, who meet the established credentialing and income requirements. By providing a refundable tax credit, this bill increases the net income of these professionals, which may improve retention and recruitment within the early childhood education sector. Employers of these staff members may also benefit indirectly through increased staff stability and the promotion of higher professional standards within their facilities.
Who Might Suffer?
The primary entity negatively impacted is the state government, which will experience a reduction in tax revenue due to the issuance of the income tax credits and subsequent refunds. Additionally, early childhood education staff who do not meet the 'Better Beginnings' quality rating system requirements or who earn above the specified salary threshold will not be eligible for this financial benefit, potentially creating a disparity in compensation among peers within the industry.
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