How Alabama Compares
Tax Credits & Subsidies
All Alabama families can claim the federal Child and Dependent Care Tax Credit (CDCTC): 20-35% of up to $3,000 for one child or $6,000 for two or more (max credit: $1,050-$2,100). If your employer offers a Dependent Care FSA, you can save up to $5,000 pre-tax per year for childcare.
Alabama Childcare FAQ
How much does daycare cost in Alabama?
The average annual cost of center-based infant care in Alabama is $6,001 per year ($500/month). Family/home daycare is typically cheaper at $4,321 per year. Toddler care costs slightly less, averaging $5,800 per year for center-based care.
What is the cheapest childcare option in Alabama?
Family/home daycare is typically the most affordable option in Alabama, averaging $4,321 per year for infant care compared to $6,001 for center-based care — about 28% less. Other options include nanny sharing (splitting a nanny's cost with another family), au pairs, or cooperative childcare arrangements.
What percentage of income goes to childcare in Alabama?
In Alabama, infant center-based care costs approximately 10.1% of the median household income ($59,609). The federal government considers childcare affordable at 7% of household income — a standard that no state currently meets for infant care.
How does daycare compare to college tuition in Alabama?
Center-based infant care in Alabama ($6,001/year) is comparable to the average in-state public college tuition ($11,100/year). In many other states, daycare actually costs more than college.
What childcare tax credits are available in Alabama?
All Alabama families can claim the federal Child and Dependent Care Tax Credit (CDCTC) of 20-35% of up to $3,000 for one child or $6,000 for two or more children. Additionally, if your employer offers a Dependent Care FSA, you can set aside up to $5,000 pre-tax for childcare expenses. Some states offer additional state-level childcare tax credits.
Does Alabama have free pre-K?
No, Alabama does not currently offer universal pre-K for all families. Some income-eligible families may qualify for state-funded preschool programs or Head Start. Check your local school district for available pre-K options.