1. Short title This Act may be cited as the Grandparents Tax Credit Act of 2017 . 2. Refundable credit for household items purchased by grandparents for grandchildren living in poverty (a) In general Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to refundable credits) is amended by inserting after section 36B the following new section: 36C. Credit for household items purchased by grandparents for grandchildren living in poverty (a) In general In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by this subtitle an amount equal to the amount paid or incurred by the taxpayer during the taxable year for household items for the benefit of any qualified child. (b) Maximum credit The credit allowed by this section for the taxable year shall not exceed $500. (c) Definitions and special rules For purposes of this section— (1) Eligible individual The term eligible individual means, with respect to any child, any individual who is a grandparent of such child. (2) Household items The term household items includes food, clothing, and other items typically used by or for the benefit of children. (3) Qualified child The term qualified child means any individual if— (A) such individual has not attained the age of 18 as of the close of the calendar year in which the taxable year of the taxpayer begins, (B) for more than one-half of such taxable year, such individual has the same principal place of abode as— (i) the taxpayer, and (ii) at least 1 parent of such child, (C) such parent is entitled to claim, and claims, a deduction for such child under section 151 (relating to allowance of deductions for personal exemptions), (D) the modified adjusted gross income (as defined in section 24(b)) of such parent (or parents in the case of a joint return) does not exceed 300 percent of the Federal poverty level (as determined in accordance with criteria established by the Director of the Office of Management and Budget), and (E) such place of