Under the updated rules, qualifying small businesses may receive a tax credit equal to 50 percent of eligible childcare expenses, with a maximum annual credit of up to $600,000.

Beginning in 2026, small businesses with average annual gross receipts under $32 million may claim a 50 percent credit on qualified childcare expenses, up to a maximum annual credit of $600,000.

Congress created a valuable new tax break for tipped workers under the One Big Beautiful Bill Act. The No Tax on Tips deduction applies retroactively beginning January 1, 2025, and the IRS has designated 2025 as a transition year. As a result, the deduction operates differently for 2025 than for later years.