Children enjoy the water Tuesday morning on the splash pad at the Kennedy Park pool on Park Street in Lewiston. (Russ Dillingham/Staff Photographer)

Parenting in Maine is expensive.

Childcare costs have exploded in recent years, and Mainers are spending more on food, gas and other needs than ever before — which makes navigating available state and federal family assistance programs crucial for some Maine families.

Here’s a snapshot of available tax breaks and subsidies for parents hoping to get ahead of the cost curve.

TRUMP ACCOUNTS

Last July, President Donald Trump signed a tax law that created a new kind of government-funded child credit: the Trump Account. Those accounts are active as of Saturday.

Parents can sign up via the Trump Accounts app or on the IRS’ Individual Online Accounts service with basic identifying and Social Security information.

By signing up for a Trump Account, parents and guardians of children born since the start of 2025 can receive $1,000 in an investment fund intended to perform roughly the same as the S&P 500 index — one of the largest and most-followed trackers on the stock market.

The $1,000 in seed money comes directly from the U.S. Treasury Department, and the accounts are automatically invested in the S&P 500-linked fund. Optionally, parents can invest up to $5,000 per year. More investment options are expected to become available soon, the department said last week.

The accounts stay under the parent’s management until the child turns 18, at which point the account becomes theirs and available to use as they see fit, with the tax restrictions of an ordinary individual retirement account.

The accounts could also be used for a child’s college or career education expenses — similar to the $500 Alfond Grants that have been awarded to all children born as Maine residents since Jan. 1, 2013.

The Alfond Scholarship Foundation invests the funds on behalf of Maine children, and parents can open an associated education savings account to add to the $500 start.

CHILD TAX CREDITS

The law that created the Trump Accounts also permanently extended and increased the Child Tax Credit, a federal tax break that lifted more than 4 million people out of poverty in 2024, according to the Center on Budget and Policy Priorities.

Parents can claim the tax credit by filling out an extra form, Schedule 8812, with their annual tax return.

Families with at least one child age 16 or under are now eligible for up to $2,200 per child, with the amount to increase each year with inflation. The program is designed as a tax break, offsetting money owed for income tax. Leftover funds head back to the family in a refund.

The law also created new eligibility rules championed by congressional Republicans that will restrict who can get the credits: Close to 20 million children nationwide may no longer be eligible because they don’t have two parents with valid Social Security numbers or because their family’s income is too low. Parents can check their eligibility on the Internal Revenue Service’s website.

Maine is one of a dozen states to provide a state-specific child tax credit, called the Dependent Exemption Tax Credit, which more than 150,000 Maine families receive. As long as parents claimed the same child under the federal tax break, they can fill out a Dependent Exemption Tax Credit worksheet to submit alongside their income taxes. The version for the 2026 tax year is not yet available.

Families can receive $310 for each qualified child and $610 for each child under age 6. Those numbers are also tied to inflation.

Garrett Martin, the executive director of the Maine Center for Economic Policy, said tying benefits to the tax code can be a slippery slope. While families are pulled out of poverty by federal and state child tax credits, Martin said the real problem-solving efforts come through well-funded public services.

Even the temporary switch during the COVID-19 pandemic to pay the federal child tax credit on a monthly basis instead of one annual lump sum made a significant difference, he said. A Columbia University study found 4 million children fell back into poverty after the tax credit became yearly again.

Both the state and federal child tax credits phase out for single filers earning more than $200,000 and joint-filing parents earning more than $400,000.

CHILDCARE SUBSIDIES

Maine’s Child Care Affordability Program subsidizes costs for childcare on a sliding scale.

The state reimburses qualified childcare providers, while families pay between 1% and 10% of their income to the provider, depending on their income level. Families can join the waitlist and find out if they are eligible — families earning up to 125% of Maine’s median income can participate — via the state’s Child Care Family Portal.

Martin said this is exactly the kind of program that could be emulated in other sectors. Direct, continuing subsidies to the childcare provider helps families budget more effectively.

But, he noted, demand far outpaces funding.

As of March, 888 providers were approved for the Child Care Affordability Program, which gives assistance to 3,307 children from 2,067 families, according to the state’s Office of Child and Family Services.

That’s only about 7% of eligible children statewide, and almost 600 families were on the waitlist this spring.