Current Tennessee status
Tennessee currently offers an application-based TDHS NEW Care Partnership grant for eligible licensed child-care providers and private-employer capacity projects; it does not operate a statewide Tri-Share benefit, and Smart Steps eligibility does not guarantee enrollment because new applicants may face a waitlist. Employers should confirm grant terms with TDHS and obtain tax advice before evaluating any conditional federal Section 45F claim.
Verified programs and resources
NEW Care Partnership Grants
TDHS currently accepts applications on an ongoing basis; eligible licensed Tennessee child-care providers (nonprofit or for-profit, per the current page) may propose employer partnerships to add licensed capacity.
Smart Steps Child Care Payment Assistance
current TDHS guidance supports children from 6 weeks through kindergarten, average 30+ weekly hours of work and/or postsecondary undergraduate education, and household income at or below 85% of Tennessee SMI, with a parent copay.
Tennessee Child Care Payment Assistance/Child Care Certificate Program
current TDHS materials confirm payment assistance, parent copays, provider reimbursement and possible overages/cost differences for eligible families.
Tennessee QRIS/Child Care Report Card System
TDHS describes quarterly scoring in health and safety and teacher-child interactions, with four visits averaged;
Federal Section 45F
For qualifying 2026 expenditures, the IRS describes a 40% credit for qualified child-care expenditures, or 50% for an eligible small business, plus 10% for qualified resource-and-referral expenditures. Statutory caps, facility, licensing, employee-access, nondiscrimination, tax-liability and no-double-benefit rules apply.
Frequently asked questions
Tennessee currently offers an application-based TDHS NEW Care Partnership grant for eligible licensed child-care providers and private-employer capacity projects; it does not operate a statewide Tri-Share benefit, and Smart Steps eligibility does not guarantee enrollment because new applicants may face a waitlist.
Section 45F is not automatic. The IRS says a taxpayer may be eligible only when it pays or incurs qualified child-care or resource-and-referral expenditures and meets the applicable facility, contract, licensing, employee-access, nondiscrimination, and other statutory requirements. Use Form 8882 to claim the credit and consult a tax professional for the employer’s actual arrangement.
State family-assistance and employer-incentive programs have their own enrollment, funding, provider, income, activity, tax, and documentation rules. Check the official agency links on this page before relying on a benefit or availability.
Official sources
Last Updated: September 27, 2026