Family Choice Tax Allowance for Small Children Act of 1988

Family Choice Tax Allowance for Small Children Act of 1988 - Title I: Credits for Families with Young Children - Amends the Internal Revenue Code to allow an individual a refundable income tax credit for each dependent child under the age of five. Establishes the credit percentage at: (1) 15 percent for a single qualified dependent; and (2) ten percent for each additional qualified dependent. Reduces the credit percentage (credit minimum is $700 per qualified dependent) for taxpayers whose earned income exceeds $8,000.

Disallows the credit to taxpayers having earned income exceeding $30,000. Directs the Secretary of the Treasury to prescribe tables for determining the credit amount.

Provides for the phase-in of higher credit amounts, beginning in FY 1993, if Congress meets total budget outlay limitations of the Congressional Budget Act of 1974.

Provides for advance tax credit payments by employers to employees who provide certification of eligibility. Requires taxpayers to file information returns to reflect such payments.

Disallows: (1) the earned income tax credit to taxpayers eligible for the young child tax credit; and (2) application of the dependent care credit in connection with a dependent child under the age of five.

Title II: Child Care Liability - Part A: Child Care Liability Reform - Applies this part to any civil action, except for intentional torts, in any State or Federal court, against any child care provider complying with the licensing or accreditation requirements of the State in which the provider is located. Makes joint and several liability inapplicable, except for concerted actions. Provides for reduction of damages awards when there are collateral sources of compensation. Sets forth standards and procedures for award of punitive or exemplary damages.

Provides that nonprofit corporations or local educational agencies are not liable for damages in any civil action (to which this part applies) brought against a separate child care-providing corporation or business organization of which they are the parent or majority owners. Encourages States to establish expedited and simplified procedures under which nonprofit organizations and local educational agencies may inexpensively and quickly incorporate or otherwise organize such entities as separate child care providers.

Part B: Child Care Liability Risk Retention Group - Authorizes any State to assist in the establishment and operation of a child care liability risk retention group (a corporation or other limited liability association of licensed child care providers that satisfies specified Federal statutory criteria). Sets forth criteria for State applications for assistance, including a requirement for a State plan containing prescribed provisions.

Directs the Secretary of Health and Human Services to review and approve State plans and to monitor State compliance with requirements of this part. Provides for suspension of payments upon a finding of noncompliance.

Authorizes appropriations.

Instructs the Secretary of Commerce with respect to allotment amounts and procedures. Sets forth provisions relating to entitlement, method, and State spending of allotment payments.

Title III: Revolving Loan Fund - Sets forth requirements for State applications for assistance to provide loans in the interest of enabling family-based child care providers to meet licensing standards. Requires submission of a State plan describing procedures and requirements for persons desiring loans from a State revolving loan fund established to provide loans to qualified applicants. Limits the amount of any such loan to $1,500.

Authorizes appropriations.

Instructs the Secretary of Commerce with respect to allotment amounts and procedures.