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Care Worker Tax Credit

Starting in 2026 (2025 tax year), qualifying child care workers, and early childhood professionals will be eligible for a refundable $1,200 Colorado state income tax credit. Tax credits reduce the amount of tax you owe or increase the amount of cash back you receive from your tax refund. Individuals can receive money back even if they do not owe any taxes.

To be eligible, early childhood professionals and child care workers must meet the following requirements:

  • Be registered in the Colorado Shines Professional Development Information System (PDIS). 
  • Have provided child care for at least 720 hours during the tax year (January-December) to children who are five years of age or younger as one of the following:
    • An employee or operator of a licensed child care center, preschool, or family child care home with a Colorado Shines rating Level 1-5; or
    • An informal family, friend, or neighbor (FFN) child care worker who provides care for children other than their own.
  • Have an adjusted gross income less than or equal to $75,000 as a single filer or $100,000 as a joint filer (if you are married and file taxes together). Adjusted gross income is your total annual income minus certain adjustments like contributions to retirement or student loan interest. 

If you meet all of the eligibility requirements and provide 720 hours of child care in 2025, you will receive your refund after filing your Colorado Individual Income Tax Return in spring 2026.

Qualified direct care workers (in the long-term care sector) are also eligible for the Care Worker Tax Credit. Please review the statute for more details on eligibility for direct care workers and refer any questions to the Colorado Department of Revenue.

  1. Register in the Colorado Shines Professional Development Information System (PDIS).
  •  PDIS is a one-stop online resource for the early childhood workforce. The PDIS is available in English, Spanish, and Arabic and offers a broad range of eLearning courses on child development, health, and safety. You must create a PDIS account to receive the credit .
  • If you do not already have an account, visit the PDIS to create an account and complete your profile.
  • View the PDIS how-to guide for Creating Your PDIS Account 
  • The PDIS Help Desk and can be reached at cdec_pdishelp@state.co.us or 1-844-447-4441 Option 2.

2. Track your hours caring for children in 2025.

  • For employees at a licensed child care program: Make sure your employment is active and verified in the PDIS (how-to guide).
  • For operators of a family child care home: Link your Family Child Care license to your PDIS profile (how-to guide).
  • For family, friend, and neighbor (FFN) child care workers: If you take care of children who are not your own and are five years of age or younger, track how many hours you spend taking care of them. You can use attendance sheets, the CDEC template, or your own system to keep track of the hours and ages of the children you take care of. This documentation will not be uploaded to the PDIS, but you will need to retain it for three years in case you are asked to show it for tax purposes.

3. Complete the Care Worker Tax Credit Attestation in PDIS (My Account > Profile Settings) by December 31, 2025.

  • Login to PDIS and complete an attestation to confirm that you have provided child care for at least 720 hours in the tax year.

4. File Your 2025 Colorado State Income Taxes in Spring 2026.

  • To receive the tax credit, you must file a Colorado Individual Income Tax-Return, even if you do not owe any taxes. After the credit is applied to reduce your income tax liability, any excess credit will be refunded to you. Information about how to claim the Care Worker Tax Credit will be available at a later date from the Colorado Department of Revenue. Free online tax filing services and free in-person tax help are available from Get Ahead Colorado/Hacia Adelante Colorado.
     

CDEC cannot provide tax advice. If you have additional questions about how to file your tax return, please contact a tax professional. Get help filing your taxes by visiting the Colorado Department of Revenue’s Community Tax Help webpage.

Please review the revised Care Work Tax Credit FAQ document (en español).

 

Questions

 

For questions, contact:

 

PDIS Help Desk

cdec_pdishelp@state.co.us

1-844-447-4441 Option 2/Opción 2

(8 a.m.-5 p.m. MST, Monday-Friday)

 

Staff is available to respond to your questions in English, Spanish, or Arabic.