S. 1599Senate116th Congress (2019-2021)In Committee

Foster Care Tax Credit Act

AI-Generated Summary

Updated April 14, 2026 at 5:25 AM UTC

The Foster Care Tax Credit Act creates a refundable $850 tax credit for taxpayers who have a qualifying foster child placed with them for at least one month, with the credit phased out for higher incomes. It also requires placement agencies and courts to report foster placements to the IRS and directs outreach and a study on emergency placements. The credit and reporting rules take effect for tax years beginning after 2019.

Key Provisions

Provides a refundable $850 credit per eligible foster family, reduced for incomes above $125,000 (single), $150,000 (married filing separately) or $250,000 (joint) thresholds.
Defines an eligible taxpayer as one who hosts a qualifying foster child (under 17, U.S. citizen or resident) for at least one calendar month; a month counts if the child stays more than 15 days.
Disallows the credit for taxpayers with prior fraudulent claims for 10 years or reckless claims for 2 years, and requires additional information for taxpayers denied credit after deficiency procedures.
Requires authorized placement agencies and courts to file information returns (Form 6039K) with the IRS detailing each placement, and to furnish statements to foster parents by Jan 31 of the following year.
Allows a taxpayer to elect not to claim the regular child tax credit for a foster child, treating the new credit as the exclusive benefit.
Adds the new credit to the list of items for which tax‑return preparers can be penalized for lack of due‑diligence.
Directs the HHS and Treasury secretaries to identify tax provisions that help foster families and to provide outreach and educational materials, with appropriations authorized as needed.
Mandates a study on the costs and documentation challenges of emergency and short‑term foster placements and requires a report to Congress within one year of enactment.

Legislative Activity

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1 earlier action

SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance. (Sponsor introductory remarks on measure: CR S3062)

Finance Committee

May 22, 2019

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SenateIntro Referral

Introduced in Senate

May 22, 2019

SenateIntro Referral

Read twice and referred to the Committee on Finance. (Sponsor introductory remarks on measure: CR S3062)

Finance Committee

May 22, 2019

Floor Debate

3 members

What members said about S. 1599 on the floor

1 Republican2 Democrats

Sen. Susan M. CollinsR-ME · May 22, 2019

Mr. President, I rise today to introduce the Better Energy Storage Technology Act. I am pleased to be partnering with Senator Heinrich on this initiative. I would also like to thank Senator Gardner,…

Mr. President, I rise today to introduce the Better Energy

Storage Technology Act. I am pleased to be partnering with Senator Heinrich on this initiative. I would also like to thank Senator Gardner, Senator Smith, Senator Coons, Senator McSally, and Senator King who have joined us as original cosponsors of the BEST Act.

Our bipartisan bill supports narrowly tailored energy storage research to develop the next generation of technologies at the Department of Energy. Advancing next generation energy storage technology will allow us to integrate more renewables into the power grid, such as wind energy or solar energy which, in turn, will help to reduce emissions and slow climate change.

Energy storage systems provide a wide range of benefits. First, these technologies increase the reliability and the resilience of the electric grid by limiting potential disruptions. Energy storage helps us to better manage supply and demand on the grid and allows for the expanded use of renewable energy. The reliability of our grid and grid- scale storage systems go hand-in-hand.

Second, this type of technology can decrease energy costs, a goal that we all share. In Maine, the price of electricity rises steeply during the coldest days of the year. For example, in late 2017 and early 2018, very cold temperatures in New England led to higher energy costs--more than a billion dollars in the wholesale energy market--in just 15 days.

The next generation of energy storage technologies could help to transform our grid, meaning that we would no longer need to generate more expensive power to meet demands during the hottest and coldest days of the year. Instead, we could use more affordable energy sources that have been stored for later use.

Third, energy storage systems can allow for more intermittent renewable sources, such as wind and solar power, to be placed on the grid and used precisely when they are needed. The Aqua Ventus, a floating, deepwater offshore wind project being developed by the University of Maine and a consortium of groups, could benefit from energy storage innovation. Off the coast of Maine, there are very strong and consistent winds where offshore wind turbines can produce electricity almost 50 percent of the time. This next generation storage technology will ensure that we can use this wind power closer to 100 percent of the time by storing electricity to use when the wind isn't blowing.

One of the biggest hurdles to commercializing energy storage is cost. To overcome this obstacle, our bill specifically directs the Department of Energy to work to decrease the cost of this exciting technology. This is similar to the Department's SunShot initiative that decreased the price of solar power by approximately 75 percent in less than a decade.

Furthermore, energy storage systems are technology neutral. This bill will foster innovation and enhance deployment of these innovative technologies without picking winners or losers.

Specifically, our bill would do the following: It would focus energy storage research on highly flexible, longer duration, and seasonal storage systems. It would support five energy storage demonstration projects. The bill would create a strategic plan and allow the Department of Energy to develop cost targets. It would coordinate research and support the coordination of research. Finally, the bill would authorize $60 million annually for each of the next 5 years.

I am pleased to report that our bipartisan bill has earned very broad support, including the endorsements of the Bipartisan Policy Center, Citizens for Responsible Energy Solutions, ClearPath, Edison Electric Institute, Energy Storage Association, the Information Technology and Innovation Foundation, the National Audubon Society, the Natural Resources Council of Maine, the National Hydropower Association, Solar Energy Industries Association, the Union of Concerned Scientists, and the U.S. Chamber of Commerce.

Frankly, it has been a long time since I have seen a bill be able to attract that much support from groups that have different ideological goals, and I am very proud that we were able to line up the support of all of those groups.

The BEST Act will help advance energy storage technologies to improve the efficiency of our Nation's electrical grid while helping to promote the wider use of clean, renewable energy. The goals of this bill are those which I would hope every Member of this body could embrace. I urge my colleagues to support this legislation.

Thank you, Mr. President.

Sen. Ron WydenD-OR · May 22, 2019

Mr. President, Oregonians have a strong interest in using biomass as a source of renewable fuels. This desire, coupled with how well we grow biomass in Oregon, creates the opportunity to use…

Mr. President, Oregonians have a strong interest in using biomass as a source of renewable fuels. This desire, coupled with how well we grow biomass in Oregon, creates the opportunity to use carefully selected wood waste as a source for cleaner transportation fuel. If we do it right, this effort will lead to healthier forests, more carbon sequestration, cleaner transportation fuels as compared to traditional gasolines, and protected old growth forests.

Current law excludes the use of federal biomass in the making of renewable fuels as defined by the Renewable Fuel Standard (RFS). The bill being introduced today eliminates that exclusion.

In addition to being an energy matter, this is an important forest management issue. Over many decades there has been an unnatural buildup of woody material on the forest floor. It becomes fuel for catastrophic wildfires. For months, each summer, Oregonians in every corner of the state, from Astoria to Adel and from Medford to Madras, suffer from smokey skies, hazardous air quality, and the almost constant threat that a wildfire may burn down their homes. In the eastern portion of the state, invasive species like juniper trees pose challenges, on both private and public lands--lowering water tables, posing fire risks, and encroaching on sage grouse habitat. It is time we stopped putting our heads in the sand, hoping the environmental ship will right itself.

Instead, this excess woody biomass should be contributing to U.S. energy independence by being converted to transportation or electricity fuels. This bill makes that economically feasible. It would make it more cost efficient for private landowners to remove low-value brush, like juniper. The bill also helps pay for programs to reduce dead and dying trees that fuel catastrophic wildfires and helps thin out unhealthy second-growth forests. The bill ensures that all residuals from the milling process and certain biomass from national forests and BLM forests qualify for the RFS standards.

Importantly, under this new definition biomass materials harvested from federal lands must be done so in accordance with all federal laws, regulations, and land-use plans and designations. In addition, the bill pays specific attention to biomass removal from insect and disease ridden forests and wildfire prone areas. And, to ensure environmental problems are being solved, not created, the bill restricts the types of biomass materials that can be harvested from federal lands so that old growth trees and stands will continue to be protected.

At the end of the day, the small diameter trees, the limbs, the debris, even sawdust at the mill presents real opportunities to generate green energy, generate green jobs, lower wildfire risks in rural areas across the country, and better position the United States to meet the RFS.

There is a lot of bipartisan support for the biomass definition in this bill. It balances sound energy policy with sound environmental policy.

I want to thank my colleagues Senators Risch, King, Crapo, and Merkley for joining me on this important bill.

Sen. Tim KaineD-VA · May 22, 2019

Mr. President, today I am introducing the Foster Care Tax Credit Act, with my colleague Senator Jones. Enacting this bill would go a long way towards helping families with the expenses that come with…

Sen. Tim KaineD-VA · May 22, 2019

Bill Text

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Introduced in SenateIssued May 22, 2019

116th CONGRESS

1st Session

S. 1599

IN THE SENATE OF THE UNITED STATES

May 22, 2019

Mr. Kaine (for himself and Mr. Jones) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to create a refundable tax credit for foster families, and for other purposes.

Short title

This Act may be cited as the Foster Care Tax Credit Act.

Foster care tax credit

(a)

Allowance of credit

(1)

In general

Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 36B the following new section:

36C.

Foster care tax credit

(a)

Allowance of credit

In the case of an eligible taxpayer, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to $850.

(b)

Limitation

(1)

In general

The amount of the credit allowable under subsection (a) (determined without regard to this subsection) shall be reduced (but not below zero) by the amount which bears the same ratio to such credit (as so determined) as—

(A)

the excess of—

(i)

the taxpayer's modified adjusted gross income for such taxable year, over

(ii)

the threshold amount, bears to

(B)

$17,000.

(2)

Threshold amount

For purposes of paragraph (1), the term threshold amount means—

(A)

$250,000, in the case of a joint return,

(B)

$150,000, in the case of an individual who is not married, and

(C)

$125,000, in the case of a married individual filing a separate return.

For purposes of this paragraph, marital status shall be determined under section 7703.

(3)

Modified adjusted gross income

For purposes of this subsection, the term modified adjusted gross income means the adjusted gross income of the taxpayer for the taxable year increased by any amount excluded from gross income under section 911, 931, or 933.

(c)

Eligible taxpayer

For purposes of this section—

(1)

In general

The term eligible taxpayer means, with respect to any taxable year, any taxpayer—

(A)

with whom a qualifying foster child was placed for a period of not less than 1 month during such taxable year, and

(B)

for whom a credit under section 24 with respect to such eligible foster child is not allowed for such taxable year.

(2)

Qualifying foster child

The term qualifying foster child means an eligible foster child (within the meaning of section 152(f)(1)(C))—

(A)

who has not attained age 17, and

(B)

who is a citizen, national, or resident of the United States.

(3)

Calendar month

For purposes of this paragraph (1)(A), if a foster child resides in the home of the taxpayer for more than 15 consecutive days of a calendar month but fewer than the total number of days in such calendar month, such foster child shall be treated as residing in the home of the taxpayer for the full calendar month.

(d)

Restrictions on Taxpayers Who Improperly Claimed Credit in Prior Year

(1)

Taxpayers making prior fraudulent or reckless claims

(A)

In general

No credit shall be allowed under this section for any taxable year in the disallowance period.

(B)

Disallowance period

For purposes of subparagraph (A), the disallowance period is—

(i)

the period of 10 taxable years after the most recent taxable year for which there was a final determination that the taxpayer's claim of credit under this section was due to fraud, and

(ii)

the period of 2 taxable years after the most recent taxable year for which there was a final determination that the taxpayer's claim of credit under this section was due to reckless or intentional disregard of rules and regulations (but not due to fraud).

(2)

Taxpayers making improper prior claims

In the case of a taxpayer who is denied credit under this section for any taxable year as a result of the deficiency procedures under subchapter B of chapter 63, no credit shall be allowed under this section for any subsequent taxable year unless the taxpayer provides such information as the Secretary may require to demonstrate eligibility for such credit.

(2)

Conforming amendments

(A)

Section 6211(b)(4) of the Internal Revenue Code of 1986 is amended by inserting 36C, after 36B,.

(B)

Section 1324(b)(2) of title 31, United States Code, is amended by inserting 25E, after 25A,.

(C)

The table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 36B the following new item:

Sec. 36C. Foster care tax credit.

(b)

Information returns relating to foster child placement

(1)

In general

Subpart A of part III of subchapter A of chapter 61 of the Internal Revenue Code of 1986 is amended by inserting after section 6039J the following new section:

6039K.

Information reporting with respect to foster child placement

(a)

In general

Every authorized placement agency and court which places a qualifying foster child with a person during a calendar year shall, at such time as the Secretary shall prescribe, make a return described in subsection (b).

(b)

Form and manner of return

A return is described in this subsection if such return—

(1)

is in such form as the Secretary may prescribe, and

(2)

contains, with respect to each qualifying foster child placed during the calendar year—

(A)

the name, address, and TIN of each individual with whom such qualifying foster child was placed,

(B)

the name of the qualifying foster child, and

(C)

the dates during which such placement occurred.

(c)

Statements To be furnished to foster parents

(1)

In general

Every person required to make a return under subsection (a) shall furnish to each individual whose name is required to be set forth under subsection (b)(2)(A) a written statement showing—

(A)

the name and address of the person required to make such return and the phone number of the information contact for such person, and

(B)

the information required to be shown on the return with respect to such individual.

(2)

Time for furnishing statements

The written statement required under paragraph (1) shall be furnished on or before January 31 of the year following the calendar year for which the return under subsection (a) was required to be made.

(d)

Qualifying foster child

For purposes of this section, the term qualifying foster child has the meaning given such term under section 36C(c)(2).

(2)

Assessable penalties

(A)

Section 6724(d)(1)(B) of such Code is amended by striking or at the end of clause (xxv), by striking and at the end of clause (xxvi) and inserting or, and by inserting after clause (xxvi) the following new clause:

(xxvii)

section 6039K (relating to information returns with respect to foster child placement),

(B)

Section 6724(d)(2) of such Code is amended by redesignating the second subparagraph (JJ) as subparagraph (KK), by striking or at the end of subparagraph (II), by striking the period at the end of the first subparagraph (JJ), by striking the period at the end of subparagraph (KK) (as so redesignated) and inserting a comma, and by inserting after such subparagraph (KK) the following new subparagraph:

(LL)

section 6039K(c) (relating to statements with respect to foster child placement).

(3)

Clerical amendment

The table of sections of subpart A of part III of subchapter A of chapter 61 of such Code is amended by inserting after the item relating to section 6039J the following new item:

Sec. 6039K. Information reporting with respect to foster child placement.

(c)

Election not To take child tax credit

Section 24(h)(4) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(D)

Election not to take credit

A taxpayer may elect not to have this paragraph apply with respect to any dependent of the taxpayer to whom a credit would otherwise be allowed by reason of subparagraph (A). In any case in which a taxpayer makes an election under this subparagraph, the credit allowed under this section shall be treated as not allowed with respect to such dependent.

(d)

Application of tax return preparer due diligence penalty

Section 6695(g) of the Internal Revenue Code of 1986 is amended by striking or 32 and inserting 32, or 36C.

(e)

Effective date

The amendments made by this section shall apply to calendar months beginning after December 31, 2019, in taxable years beginning after such date.

(f)

Education

(1)

In general

The Secretary of Health and Human Services (or the Secretary's delegate), in coordination with the Secretary of the Treasury or such Secretary's delegate, shall identify provisions in the Internal Revenue Code of 1986 that can be used by or can benefit foster families, and shall increase outreach efforts to provide information and educational materials regarding such provisions to State and Indian tribal foster care agencies and to foster families.

(2)

Authorization of appropriations

There are authorized to be appropriated such sums as necessary for the purposes of carrying out paragraph (1).

Study and report on emergency and short-term foster placements

(a)

Study

The Secretary of Health and Human services, in coordination with the Secretary of the Treasury (or the Secretary's delegate), shall conduct a study on—

(1)

the costs and financial burdens on foster families who experience multiple emergency and short-term foster placements annually; and

(2)

challenges to verifying and documenting the placement of children in emergency and short-term placement.

For purposes of this subsection, a short-term placement is a placement that lasts less than 1 week.

(b)

Report

Not later than 1 year after the date of the enactment of this Act, the Secretary of Health and Human Services shall submit to Congress a report on the study conducted under subsection (a).