President Trump’s sweeping tax and immigration bill is sending shockwaves in Washington—and you might feel it yourself if you get the Child Tax Credit. The bill, whichjust barely passed the House in May, is now up for debate in the Senate. Republicans are racing to get it to Trump’s desk by the Fourth of July. But behind the political pomp and circumstance is a developing worry: will you forfeit access to one of the most useful tax breaks for families?
The child tax credit boost—But not for everyone
You may have heard that the bill raises the Child Tax Credit to $2,500 per child from $2,000. At first, that sounds like a triumph. But there is a catch. If passed as drafted, millions of families—especially those in mixed-status families—will lose the credit altogether.
Why? Because under the new rules, both parents would have to possess a Social Security number to claim the credit. That means even if your child is an American citizen, your family might no longer qualify if one parent is illegal or possesses an Individual Taxpayer Identification Number (ITIN).
Who’s affected the most?
Around 4.5 million kids would have the Child Tax Credit eligibility taken away, according to estimates from the Center on Poverty and Social Policy, the Center for Migration Studies, and the Institute on Taxation and Economic Policy (ITEP). The states with the most immigrants—California, Texas, Florida, New York, and Illinois—would be hit the worst.
These changes don’t stop at the Child Tax Credit. Carl Davis of ITEP says the new SSN requirement could impact other tax credits as well. That is, families who have been relying on those credits to make ends meet now could see their refunds reduced or eliminated altogether.
What’s the credit like now?
If you’re eligible in 2024, this year’s Child Tax Credit pays you up to $2,000 for each of your children under age 17. Unless Congress extends it, it will fall to $1,000 by the end of the year.
To qualify for the maximum credit, your income needs to be under $200,000 if you’re single or $400,000 if you’re married and file a joint return. Over those limits, the credit phases out.
The credit is refundable only partly. If you owe less tax than your credit, the difference can be refunded—the Additional Child Tax Credit. But you’ll need to have at least $2,500 of income to get that.
How is the refund calculated?
You take your earned income (excluding such items as Social Security or unemployment), subtract $2,500, and then multiply the result by 15%. That’s the refundable portion.
So, for example, if you earn $20,000:
- $20,000 – $2,500 = $17,500
- $17,500 × 15% = $2,625 (that’s the maximum refundable amount you’d qualify for, subject to the credit limit)
Other rules of eligibility you should be aware of
Your child must:
- Be under the age of 17 at the end of the tax year
- Possess a valid work-authorized Social Security number
- Live with you for more than half the year
- Be financially supported by you as a dependent individual
What you can do now
If your household might be affected by the new law, stay close to the action as it moves through the Senate. Meanwhile, the Child Tax Credit stays on the books as it is presently written. But if the “one big, beautiful bill” does come to pass, it might be a farewell to a credit that’s helped tens of millions of families like yours.
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