(a) A business which qualifies for the refund of the gross receipts tax or compensating use tax under § 26-52-516 or § 26-53-132 shall be allowed an income tax credit of three and nine-tenths percent (3.9%) of the annual salary of its employees employed exclusively in providing child care service, or a five thousand dollar ($5,000) income tax credit for the first tax year the business provides its employees with a child care facility.

(b) If two (2) or more businesses participate in a child care program for their employees as provided by § 26-52-516 or § 26-53-132, then each business will be allowed an income tax credit of three and nine-tenths percent (3.9%) of the annual salary of only those employees who are on the respective business' payroll and are employed exclusively for providing child care services. The first year's five thousand dollar ($5,000) credit will be prorated among the businesses based upon the percentage of the cost paid by each business for the initial construction and equipping of the child care facility.

(c) (1) (A) To qualify for the income tax credit, the revenue to the business or businesses from the child care facility cannot exceed the direct operating costs of the facility.

(B) If, on an annual basis, the business receives revenues from the operation of the child care facility which exceed the direct operating costs of the facility, the businesses will not be entitled to the income tax credit.

(2) As used in this subsection, "direct operating costs" means:

(A) The cost of food and beverages provided to the children;

(B) The cost of labor for personnel whose services are performed exclusively on the premises of the child care facility for the care of the children and all related employment taxes paid by the employer; and

(C) All materials and supplies necessary to operate the child care facility.

(d) The income tax credit created by subsection (a) of this section shall first be available in the taxable year following the year the business makes payment of wages to child care workers. To the extent that the credit is not fully utilized in this first year, it may be carried forward for an additional two (2) years. Any credit remaining thereafter shall expire.