Duo-Share Child Care: Employer–Employee Cost Sharing

What Duo-Share means

Duo-Share is an employer-designed child-care benefit in which an employer and employee share a defined cost. It can be structured in many ways, but it is not a government program unless a specific state or local administrator says otherwise.

Practical design questions

• Which employees and care arrangements are eligible?
• Will the employer pay a provider, contract for care, reimburse employees, or use an intermediary?
• How will the company document payments and protect employee privacy?
• Can the benefit be offered fairly under applicable employment and tax rules?
• Do the actual expenditures satisfy the IRS requirements for any federal credit?

Section 45F note

Section 45F may apply only to qualifying expenditures and arrangements. For 2026, the IRS describes 40% and 50% rates depending on eligible-small-business status, a separate 10% resource-and-referral rate, and annual credit caps. Read the current IRS guidance and consult a tax professional before treating a private cost-sharing model as creditable.