Part I

Increases the child income tax deduction amounts under GS 105-153.5(a1) in amounts ranging by a $600 increase (so the deduction goes from $3,000 to $3,600) for persons earning up to $40,000 per year to a $100 increase (so the deduction goes from $500 to $600) to persons earning over $120,000 and up to $140,000 whose tax filing status is married filing jointly. For persons filing as head of household, Increases the child deduction amounts under GS 105-153.5(a1) in amounts ranging by a $600 increase (so the deduction goes from $3,000 to $3,600) for persons earning up to $30,000 per year to a $100 increase (so the deduction goes from $500 to $600) to persons earning over $90,000 and up to $105,000. For persons filing as single or as married filing separately, Increases the child deduction amounts under GS 105-153.5(a1) in amounts ranging by a $600 increase (so the deduction goes from $3,000 to $3,600) for persons earning up to $20,000 per year to a $100 increase (so the deduction goes from $500 to $600) to persons earning over $60,000 and up to $70,000.  Effective for tax years beginning on or after January 1, 2024.

Part II

Adds new Part 10D, Child Care Stabilization (CCS), to Article 3 of GS Chapter 143B, to stabilize the child care sector, enhance workforce support for child care professionals, and ensure access to quality early childhood education for all families in North Carolina. Creates the CCS Fund (Fund) within the Department of Health and Human Services (DHHS) to be used to provide financial assistance to child care facilities with a focus on supporting low-income families and enhancing wages of child care providers in the State. Designates DHHS to administrate grants from the Fund. Specifies eligibility requirements for child care providers to receive grants from the Fund, including holding a license or being subject to regulation by Division of Child Development and Early Education (Division) on or before March 11, 2021. Adds new GS 143B-168.42 (workforce support and professional development) providing for professional development initiatives for child care providers and requiring that grant recipients use a portion of those funds to increase wages for child care providers with a focus on addressing wage disparities and promoting workforce retention. Requires the Division, in consultation with experts, to develop guidelines and standards to ensure that child care facilities supported by the Fund provide high-quality early childhood education.  Requires DHHS to submit an annual report by December 1 of each year to the General Assembly detailing use of the Fund, the impact on child care facilities, and any recommendations for program improvement. 

Appropriates $180 million from the General Fund to the Division in recurring funds for the 2024-2025 fiscal year to provide continued funding for CCS grants. Effective July 1, 2024. 

Part III

Directs the Division to establish the Child Care Provider Support Program (Program) to provide financial assistance to child care providers in this State. Directs that child care providers, regardless of household income, are eligible for free child care services for their own children while actively employed in a licensed child care facility in North Carolina. Requires the Division to collaborate with licensed child care facilities to implement and monitor the Program. Requires the Division to submit a report to the General Assembly within one year of the Program’s implementation detailing its impact and effectiveness.  Appropriates $10 million from the General Fund to the Division in recurring funds for the 2024-2025 fiscal year for the implementation of the Program. Effective July 1, 2024.