NY A06774 Enhanced Child and Dependent Care Credit

changelog_entry.yaml

@@ -0,0 +1,4 @@
+- bump: minor
+  changes:
+    added:
+    - NY Assembly Bill A06774 Enhanced Child and Dependent Care Credit reform.

policyengine_us/parameters/gov/contrib/states/ny/a06774/in_effect.yaml

@@ -0,0 +1,10 @@
+description: The New York Enhanced Child and Dependent Care Credit Act (Assembly Bill A06774) applies if this is true.
+metadata:
+  unit: bool
+  period: year
+  label: NY A06774 Enhanced Child and Dependent Care Credit in effect
+  reference:
+    - title: NY Assembly Bill 2025-A6774
+      href: https://www.nysenate.gov/legislation/bills/2025/A6774
+values:
+  0000-01-01: false

policyengine_us/parameters/gov/contrib/states/ny/a06774/income_threshold.yaml

@@ -0,0 +1,12 @@
+description: The maximum New York adjusted gross income to qualify for the enhanced child and dependent care credit under Assembly Bill A06774.
+metadata:
+  unit: currency-USD
+  period: year
+  label: NY A06774 enhanced child and dependent care credit income threshold
+  reference:
+    - title: NY Assembly Bill 2025-A6774 Section 1
+      href: https://www.nysenate.gov/legislation/bills/2025/A6774
+    - title: NY Tax Law Section 606 - Credits Against Tax
+      href: https://www.nysenate.gov/legislation/laws/TAX/606
+values:
+  2025-01-01: 50_000

policyengine_us/parameters/gov/contrib/states/ny/a06774/match.yaml

@@ -0,0 +1,12 @@
+description: New York provides this multiplier of the federal Child and Dependent Care Credit for eligible taxpayers under the Enhanced Child and Dependent Care Credit Act.
+metadata:
+  unit: /1
+  period: year
+  label: NY A06774 enhanced child and dependent care credit match
+  reference:
+    - title: NY Assembly Bill 2025-A6774 Section 1
+      href: https://www.nysenate.gov/legislation/bills/2025/A6774
+    - title: NY Tax Law Section 606 - Credits Against Tax
+      href: https://www.nysenate.gov/legislation/laws/TAX/606
+values:
+  2025-01-01: 1.1

policyengine_us/reforms/reforms.py

@@ -21,6 +21,7 @@
 from .eitc import create_halve_joint_eitc_phase_out_rate_reform
 from .states.ny.wftc import create_ny_working_families_tax_credit_reform
 from .states.sc.h3492 import create_sc_h3492_eitc_refundable_reform
+from .states.ny.a06774 import create_ny_a06774_enhanced_cdcc_reform
 from .harris.lift.middle_class_tax_credit import (
     create_middle_class_tax_credit_reform,
 )
@@ -182,6 +183,9 @@ def create_structural_reforms_from_parameters(parameters, period):
     sc_h3492_eitc_refundable = create_sc_h3492_eitc_refundable_reform(
         parameters, period
     )
+    ny_a06774_enhanced_cdcc = create_ny_a06774_enhanced_cdcc_reform(
+        parameters, period
+    )
 
     middle_class_tax_credit = create_middle_class_tax_credit_reform(
         parameters, period
@@ -328,6 +332,7 @@ def create_structural_reforms_from_parameters(parameters, period):
         halve_joint_eitc_phase_out_rate,
         ny_wftc,
         sc_h3492_eitc_refundable,
+        ny_a06774_enhanced_cdcc,
         middle_class_tax_credit,
         rent_relief_tax_credit,
         end_child_poverty_act,

policyengine_us/reforms/states/ny/a06774/__init__.py

@@ -0,0 +1,3 @@
+from .ny_a06774_enhanced_cdcc import (
+    create_ny_a06774_enhanced_cdcc_reform,
+)

policyengine_us/reforms/states/ny/a06774/ny_a06774_enhanced_cdcc.py

@@ -0,0 +1,76 @@
+from policyengine_us.model_api import *
+
+
+def create_ny_a06774_enhanced_cdcc() -> Reform:
+    """
+    NY Assembly Bill A06774 - Enhanced Child and Dependent Care Credit
+
+    Increases the NY child and dependent care credit to 110% of the federal
+    credit for taxpayers with NY adjusted gross income up to $50,000.
+
+    Reference: https://www.nysenate.gov/legislation/bills/2025/A6774
+    """
+
+    class ny_cdcc(Variable):
+        value_type = float
+        entity = TaxUnit
+        label = "NY CDCC"
+        unit = USD
+        definition_period = YEAR
+        reference = (
+            "https://www.nysenate.gov/legislation/bills/2025/A6774",
+            "https://www.nysenate.gov/legislation/laws/TAX/606",
+        )
+        defined_for = StateCode.NY
+
+        def formula(tax_unit, period, parameters):
+            p = parameters(period).gov.contrib.states.ny.a06774
+            in_effect = p.in_effect
+            ny_agi = tax_unit("ny_agi", period)
+            income_threshold = p.income_threshold
+            match = p.match
+
+            # Calculate the enhanced credit (110% of federal CDCC)
+            federal_cdcc = tax_unit("cdcc", period)
+            enhanced_cdcc = federal_cdcc * match
+
+            # Calculate the standard NY CDCC
+            cdcc_max = tax_unit("ny_cdcc_max", period)
+            expenses = tax_unit("cdcc_relevant_expenses", period)
+            ny_rate = tax_unit("ny_cdcc_rate", period)
+            federal_rate = tax_unit("cdcc_rate", period)
+            standard_ny_cdcc = min_(
+                cdcc_max, expenses * ny_rate * federal_rate
+            )
+
+            # Use enhanced credit if reform is in effect and income is
+            # at or below the threshold
+            eligible_for_enhanced = in_effect & (ny_agi <= income_threshold)
+            return where(
+                eligible_for_enhanced, enhanced_cdcc, standard_ny_cdcc
+            )
+
+    class reform(Reform):
+        def apply(self):
+            self.update_variable(ny_cdcc)
+
+    return reform
+
+
+def create_ny_a06774_enhanced_cdcc_reform(
+    parameters, period, bypass: bool = False
+):
+    if bypass:
+        return create_ny_a06774_enhanced_cdcc()
+
+    p = parameters(period).gov.contrib.states.ny.a06774
+
+    if p.in_effect:
+        return create_ny_a06774_enhanced_cdcc()
+    else:
+        return None
+
+
+ny_a06774_enhanced_cdcc = create_ny_a06774_enhanced_cdcc_reform(
+    None, None, bypass=True
+)

policyengine_us/tests/policy/contrib/states/ny/a06774/ny_a06774_enhanced_cdcc.yaml

@@ -0,0 +1,169 @@
+# NY A06774 Enhanced Child and Dependent Care Credit Tests
+# Tests the enhanced CDCC at 110% of federal credit for incomes up to $50,000
+
+# Basic eligibility tests - income below threshold
+- name: Enhanced CDCC - income $40k with one child gets 110% of federal
+  period: 2025
+  reforms: policyengine_us.reforms.states.ny.a06774.ny_a06774_enhanced_cdcc.ny_a06774_enhanced_cdcc
+  input:
+    gov.contrib.states.ny.a06774.in_effect: true
+    people:
+      person1:
+        age: 35
+        is_tax_unit_head: true
+        employment_income: 40_000
+      child1:
+        age: 5
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [person1, child1]
+        tax_unit_childcare_expenses: 3_000
+    households:
+      household:
+        members: [person1, child1]
+        state_code: NY
+  output:
+    # Federal CDCC: $3,000 * 22% = $660
+    # (rate is 22% for AGI around $40k)
+    # Enhanced: $660 * 1.1 = $726
+    ny_cdcc: 726
+
+- name: Enhanced CDCC - income at $50k threshold still gets enhanced credit
+  period: 2025
+  reforms: policyengine_us.reforms.states.ny.a06774.ny_a06774_enhanced_cdcc.ny_a06774_enhanced_cdcc
+  input:
+    gov.contrib.states.ny.a06774.in_effect: true
+    people:
+      person1:
+        age: 35
+        is_tax_unit_head: true
+        employment_income: 50_000
+      child1:
+        age: 5
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [person1, child1]
+        tax_unit_childcare_expenses: 3_000
+    households:
+      household:
+        members: [person1, child1]
+        state_code: NY
+  output:
+    # Federal CDCC: $3,000 * 20% = $600
+    # (rate floors at 20% for AGI $43k+)
+    # Enhanced: $600 * 1.1 = $660
+    ny_cdcc: 660
+
+# Income above threshold - uses standard NY CDCC
+- name: Income above $50k threshold uses standard NY CDCC formula
+  period: 2025
+  absolute_error_margin: 1
+  reforms: policyengine_us.reforms.states.ny.a06774.ny_a06774_enhanced_cdcc.ny_a06774_enhanced_cdcc
+  input:
+    gov.contrib.states.ny.a06774.in_effect: true
+    people:
+      person1:
+        age: 35
+        is_tax_unit_head: true
+        employment_income: 60_000
+      child1:
+        age: 5
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [person1, child1]
+        tax_unit_childcare_expenses: 3_000
+    households:
+      household:
+        members: [person1, child1]
+        state_code: NY
+  output:
+    # Income above threshold, uses standard NY CDCC which applies
+    # NY-specific rate multipliers on top of federal rate
+    # Standard NY CDCC at $60k = $650.16
+    ny_cdcc: 650
+
+# Reform not in effect
+- name: Reform not in effect - uses standard NY CDCC
+  period: 2025
+  absolute_error_margin: 1
+  reforms: policyengine_us.reforms.states.ny.a06774.ny_a06774_enhanced_cdcc.ny_a06774_enhanced_cdcc
+  input:
+    gov.contrib.states.ny.a06774.in_effect: false
+    people:
+      person1:
+        age: 35
+        is_tax_unit_head: true
+        employment_income: 40_000
+      child1:
+        age: 5
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [person1, child1]
+        tax_unit_childcare_expenses: 3_000
+    households:
+      household:
+        members: [person1, child1]
+        state_code: NY
+  output:
+    # Without reform, uses standard NY CDCC formula
+    # Standard NY CDCC at $40k = $660
+    ny_cdcc: 660
+
+# Two children test
+- name: Enhanced CDCC - two children with $6k expenses
+  period: 2025
+  reforms: policyengine_us.reforms.states.ny.a06774.ny_a06774_enhanced_cdcc.ny_a06774_enhanced_cdcc
+  input:
+    gov.contrib.states.ny.a06774.in_effect: true
+    people:
+      person1:
+        age: 35
+        is_tax_unit_head: true
+        employment_income: 40_000
+      child1:
+        age: 5
+        is_tax_unit_dependent: true
+      child2:
+        age: 3
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [person1, child1, child2]
+        tax_unit_childcare_expenses: 6_000
+    households:
+      household:
+        members: [person1, child1, child2]
+        state_code: NY
+  output:
+    # Federal CDCC: $6,000 * 22% = $1,320
+    # Enhanced: $1,320 * 1.1 = $1,452
+    ny_cdcc: 1_452
+
+# Edge case - no childcare expenses
+- name: Enhanced CDCC - no childcare expenses returns zero
+  period: 2025
+  reforms: policyengine_us.reforms.states.ny.a06774.ny_a06774_enhanced_cdcc.ny_a06774_enhanced_cdcc
+  input:
+    gov.contrib.states.ny.a06774.in_effect: true
+    people:
+      person1:
+        age: 35
+        is_tax_unit_head: true
+        employment_income: 40_000
+      child1:
+        age: 5
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [person1, child1]
+        tax_unit_childcare_expenses: 0
+    households:
+      household:
+        members: [person1, child1]
+        state_code: NY
+  output:
+    ny_cdcc: 0