Permanent Changes to Child Tax Credit Set to Reshape Family Benefits
Beginning in 2026, the child tax credit will undergo sweeping changes under President Donald Trump’s newly passed tax and spending package. The credit increases from $2,000 to $2,200 per child and will be adjusted annually for inflation—a long-awaited victory for some advocates. However, new eligibility rules will bar millions of children, especially those in low-income or immigrant families, from receiving full benefits. Supporters argue the credit’s inflation adjustment ensures long-term sustainability, but critics warn the structural changes will disproportionately harm those already struggling, particularly as other federal safety nets shrink.
New Requirements Limit Access for Immigrant and Low-Income Families
The most contentious shift involves the requirement for Social Security numbers. For the first time, both the child and at least one parent or guardian must have Social Security numbers to claim the credit. Previously, parents could use an Individual Taxpayer Identification Number. This change disqualifies an estimated 2.7 million children, many from mixed-status or undocumented households, from the benefit. Families with undocumented single parents, even if their children are U.S. citizens, are entirely excluded from the credit. Critics call this a targeted exclusion that disproportionately affects marginalized communities.
Credit Remains Out of Reach for Poorest Families
Despite the increase, the credit still phases in based on income, meaning families must earn more to access the full amount. A single parent with one child must earn at least $28,700; for a family with four children, the threshold rises to $45,800. Roughly 28% of children will not qualify for the full credit due to insufficient household income, up from 25% under current law. Only families earning above $2,500 annually can claim any amount. Families that owe no taxes can receive up to $1,700 per child in refundable credits, but not the full benefit.
Marginalized Groups Disproportionately Affected
According to Columbia University’s Center on Poverty and Social Policy, the new structure increases the number of children ineligible for the full benefit—from 17 million to 19 million. Native American, Black, Latinx, and rural children, along with those in single-mother households, will be most affected. For example, 60% of children in single-mother families will now be eligible for the full credit, compared to 55% under current rules. The gap in access between demographic groups has widened, raising concerns about long-term equity.
Critics Warn of Broader Impact as Other Safety Nets Shrink
Supporters highlight the credit’s inflation adjustment and permanent status as positive changes. But critics argue the reform comes at a cost. The same legislation cuts $186 billion from SNAP and slashes $1 trillion from Medicaid and CHIP over the next decade. Advocates like Meredith Dodson warn that these cuts, combined with reduced access to credit, will leave many low-income families struggling to meet basic needs. Some analysts argue that the permanent nature of the new structure makes future corrections more challenging, potentially locking in systemic disparities for years to come.
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The child tax credit is changing. Here’s what it means for your family.
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