You may be eligible for Nebraska's refundable Child Care Tax Credit if:
► You have a child or children who were age 5 or younger as of December 31, 2025, AND
► Your annual household income was $150,000 or less in 2025

In addition, at least ONE of the following must apply to your family:
► Your child is enrolled in a licensed child care program, OR
► Your child receives care from a license-exempt child care provider who participates in the child care subsidy, OR
► Your total annual household income is less than or equal to 100% of the Federal Poverty Level (FPL). For more information, click here.

Refundable tax credits are subtracted from the amount you owe in state income tax. If the amount of your credit is larger than your tax liability, the difference is refunded to you.

If you qualify, the amount of the credit is determined by your annual household income and the number of children age 5 or younger.

Yes, if you meet the eligibility requirements, you should try again for the 2025 tax year.

Last year, the Nebraska Department of Revenue (NDOR) received over $22 million in applications for the refundable Child Care Tax Credit, far exceeding the annual $15 million limit set by the Nebraska Legislature. It is likely that the same will occur in 2025. Because the demand is so high, not all applicants will able to benefit from the tax credit—but the sooner you submit your application after the application window opens in late January 2026, the better your chances are of receiving the credit before the available dollars run out.

Applications for the 2025 refundable Child Care Tax Credit will be processed on a first-come-first-served basis by NDOR, strictly in the order in which they are received. Once the $15 million limit has been reached, no further applications for this credit will be accepted until the application window opens again for the following year.

Example 1: A single-child family with an annual household income of $110,000 has a 1-year-old enrolled in a licensed child care program. The family could qualify for a $1,000 refundable tax credit.

Example 2: A two-child family with an annual household income of $72,000 has a 1-year-old and a 3-year-old enrolled in a licensed child care program. The family could qualify for a $4,000 refundable tax credit ($2,000 per child).

Example 3: A single-child family of three has an annual household income of $24,000 and a 1-year-old who is cared for at home. This family could qualify for a $2,000 refundable tax credit even though their child is not enrolled in a licensed program because their household income is below the  Federal Poverty Level for a 3-person household ($26,650).

The Federal Poverty Level (FPL) is used to determine eligibility for certain benefits and programs based on the size of the family’s household. It is re-calculated every year by the federal government. Learn more about FPL guidelines here

No, they are entirely different. Nebraska's refundable Child Care Tax Credit has its own separate application process and is claimed on your state income tax return. The federal Child Tax Credit is claimed directly on your federal income tax return.