New Hampshire Child Care Tax Incentives
Current for 2026 Tax Year • Last Updated: January 24, 2026
Hidden 75% CDFA Tax Credit + Business Incentive Grants + Federal 45F!
💎 NH CFOs: Don't Miss This!
New Hampshire is NOT "Federal Only"! While there's no direct employer child care credit, the CDFA Tax Credit Program offers a 75% state tax credit for donations to community child care projects. Combined with federal benefits, your net cost can be less than 10 cents on the dollar!
The 2026 New Hampshire "Stack"
New Hampshire offers multiple pathways: the hidden CDFA donation credit, Business Incentive Grants, and federal Section 45F.
Claim a tax credit for 40% (Large Business) or 50% (Small Business) of qualified child care expenses, up to $600,000 annually.
Donate to approved child care projects → Get 75% back against BPT/BET!
💡 New Hampshire Strategy: The "Triple Play"
1) Donate to a CDFA-approved child care project (75% state credit). 2) Apply for Business Incentive Grants (cash from the state). 3) Use Federal 45F for your own operating costs. Net result: massive child care capacity at minimal cost!
💎 The "Hidden" 75% Tax Credit (CDFA)
While there is no direct "Employer Child Care Credit," New Hampshire offers one of the most generous donation credits in the country.
How It Works
If you donate to a selected non-profit child care project through the Community Development Finance Authority (CDFA), you can receive a 75% New Hampshire Tax Credit against your Business Enterprise Tax (BET) or Business Profits Tax (BPT).
| Action | Amount |
|---|---|
| Donate to CDFA-approved child care project | $10,000 |
| NH State Tax Credit (75%) | -$7,500 |
| Federal Charitable Deduction (~25%) | -$2,500 |
| Net Cost of $10,000 Donation | ~$0 (or less!) |
🎯 The Pitch
"Donate $10,000 to your local YMCA's child care expansion → Get $7,500 back from NH + federal deduction. Your net cost is less than 10 cents on the dollar. Build goodwill, expand community capacity, and pay almost nothing!"
🚀 Child Care Business Incentive Grant
New Hampshire is aggressively funding child care through grants, not just credits.
💰 The Deal
The Child Care Business Incentive Grant provides cash to employers who partner with providers to create new child care slots.
- What You Get: The state will literally write you a check to help build out the facility or buy down the cost of slots
- No Tax Filing Required: This is a grant, not a credit—you get cash, not a tax reduction
- Action: Don't wait for a tax break. Apply for the Business Incentive Grant NOW!
🏠 The "Workforce Housing" Connection
In NH, "Child Care" and "Housing" are often funded by the same InvestNH or CDFA buckets. If you're already working with these programs for workforce housing, ask about child care funding too!
🏭 NH Success Story: Hypertherm Associates (Upper Valley)
Hypertherm Associates (industrial manufacturing) is the "Toyota of the North" for employer-sponsored child care.
The Model
- Facilities: Two on-site child care centers (Hanover and Lebanon)
- Impact: They claim it is their #1 retention tool
- Philosophy: They didn't just build a center; they built a retention machine
💡 The Lesson for NH Employers
"Follow Hypertherm's lead in the Upper Valley. They didn't just build a center; they built a retention machine. Use the Federal 45F credit to offset the operating costs of a similar center."
New Hampshire-Specific Example: The "Triple Play" Scenario
A manufacturing company in the Upper Valley uses all three NH strategies.
| Strategy | Investment | Credit/Grant | Net Cost |
|---|---|---|---|
| CDFA Donation (local YMCA center) | $50,000 | 75% = $37,500 | $12,500 |
| Business Incentive Grant (slots) | $0 (grant) | $25,000 cash | -$25,000 |
| Federal 45F (operating costs) | $100,000 | 50% = $50,000 | $50,000 |
| Total | $150,000 invested | $112,500 back | $37,500 net! |
🏔️ The New Hampshire Advantage
By using the "Triple Play" (CDFA + Grant + 45F), you invest $150,000 in child care capacity but only pay $37,500 net. That's 75% off your total investment! Plus you've built community goodwill and a retention machine.
New Hampshire Compliance & Resources
💎 CDFA Tax Credit Program
Apply for the 75% state tax credit for donations to approved community development projects including child care.
CDFA New Hampshire →🚀 Business Incentive Grants
Apply for cash grants to create new child care slots. Part of NH's workforce stabilization plan.
NH DHHS Child Care →📋 Licensing Requirements
Child care facilities must be licensed by the NH Department of Health and Human Services.
NH Child Care Licensing →New Hampshire Child Care Landscape
One of the highest donation credits in the US!
The gold standard in the Upper Valley.
Employer support is critical.
Why NH Employers Are Investing in Child Care
New Hampshire's tight labor market makes child care a competitive advantage. With the CDFA 75% credit, Business Incentive Grants, and Federal 45F, employers can build significant child care capacity at minimal net cost. The Hypertherm model proves it works for manufacturing; adapt it for your industry!
- Hanover/Lebanon (Upper Valley) – Healthcare, education, manufacturing (Hypertherm model!)
- Manchester – Healthcare, tech, financial services
- Nashua – Tech, defense, manufacturing
- Concord – Government, healthcare, education
- Portsmouth/Seacoast – Tourism, tech, healthcare
Qualified Intermediary Platforms for 45F
Under the One Big Beautiful Bill Act (OBBBA) 2026 updates, employers can now claim Section 45F credits for expenses paid to qualified intermediary service providers.
Child Care Marketplace Platforms
Technology platforms that connect employees with vetted, licensed child care providers. Subscription fees and network access qualify under 45F.
Benefits Administration Services
Third-party administrators that manage employer child care benefits, including enrollment, provider payments, and compliance reporting.
Resource & Referral Agencies
Community-based organizations that help employees find quality child care. Contracts with R&R agencies qualify for the 10% referral credit.
Child Care Subsidy Programs
Employer-funded subsidy programs that offset employee child care costs. Direct subsidies are fully eligible for the 40-50% credit.
New Hampshire Child Care Tax Credit FAQ
If you donate to a selected non-profit child care project through the Community Development Finance Authority (CDFA), you can receive a 75% New Hampshire Tax Credit against your Business Enterprise Tax (BET) or Business Profits Tax (BPT). Donate $10,000 → Get $7,500 back!
New Hampshire provides cash grants to employers who partner with providers to create new child care slots. Don't wait for a tax break—apply for the Business Incentive Grant and the state will write you a check to help build out the facility or buy down the cost of slots.
Hypertherm Associates (industrial manufacturing) operates two on-site centers in Hanover and Lebanon. They call it their #1 retention tool. They're the "Toyota of the North" for employer-sponsored child care.
Yes! When you combine the 75% CDFA state credit with the federal deduction, the net cost of your contribution is often less than 10 cents on the dollar. This is one of the best deals in the country.
Yes! In NH, "Child Care" and "Housing" are often funded by the same InvestNH or CDFA buckets. If you're already working with these programs for workforce housing, ask about child care funding too!
Calculate Your Potential New Hampshire Credit
Use our free calculator to estimate your potential federal + state tax savings. See how the "Triple Play" can work for your NH business!
Calculate Now