On April 27, 2026, Kansas Governor Kelly signed Senate Bill 82 into law. The bill updates several Kansas income tax credits by expanding the employer child care credit, creating two new credits (higher-ethanol blend fuel; firearm safety storage), discontinuing the alternative-fueled motor vehicle/fueling station credit, and repealing several dormant credits. 

A summary of changes is provided below:
 

Item	What changed	Key parameters	Effective / availability	Notes
Employer Child Care Assistance Tax Credit	Expanded eligible expenditures (including certain third party contributions) and modernized credit terms.	50-75% of eligible expenditures; cap: $100,000 per taxpayer annually; statewide aggregate cap: $3,000,000 per fiscal year. [1]	Effective: January 1, 2027	Nonrefundable; carryforward up to 3 succeeding tax years.
Higher Ethanol Blend Fuel Tax Credit	New credit for retail sales of E15 or higher ethanol blended motor fuels.	$0.05 per gallon; statewide aggregate cap: $2.5 million per tax year (pro rated among claimants if exceeded).	For tax years 2026–2028	Retail dealer must dispense through metered pumps into motor vehicle fuel tanks for public consumption; carryforward up to 3 taxable years.
Firearm Safety Storage Tax Credit	New individual credit for purchases of qualifying lockable storage items.	25% of eligible expenditures; cap: $250 per taxpayer annually.	For tax years 2026–2028	Carryforward allowed indefinitely until fully used.
Alternative Fueled Motor Vehicle / Fueling Station Credit	Discontinued (no new credits generated after cutoff).	N/A (credit generation ended).	No new credits for tax years beginning after 12/31/2026	Existing carryover provisions remain for unused credits generated before 2027.

[1] If an employer makes a contribution to a third-party community child care program, the credit is 75% if the recipient facility accepts and serves children receiving a child care subsidy, but if the facility does not accept or serve subsidized families, the credit drops to 50%.

Dormant Statutory Credits Repealed 

The following dormant or unused credits are repealed from the Kansas tax code after 2026: 

• Owners Promoting Employment Across Kansas (PEAK) Credit (distinct from the widely used PEAK payroll withholding retention program)
• Agritourism Liability Insurance Credit
• Assistive Technology Contributions Credit
• Declared Disaster Capital Investment Credit
• Swine Facility Improvement Credit

Please reach out if you’d like to discuss these changes.


 

Published: 05/20/2026

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