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Senate Republicans on Tuesday passed President Donald Trump’s spending package, which includes a bigger child tax credit — but some families won’t see a benefit, policy experts say.
Under current law, the maximum child tax credit is $2,000, which will revert to $1,000 after 2025 without changes from Congress. Wider income eligibility limits will also sunset without an extension.
If enacted, the Senate bill would permanently raise the top credit to $2,200 starting in 2025. The provision would also index this figure for inflation after 2025.
By contrast, the House-approved One Big Beautiful Bill Act would increase the highest child tax credit to $2,500 from 2025 through 2028. After that, the credit’s max value would fall to $2,000 and be indexed for inflation.
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With differences between the Senate and House provisions, it’s unclear how the measure could change. The House still must approve the Senate’s legislation before it arrives at Trump’s desk for his signature.
How to calculate the child tax credit
For 2025, the child tax credit is worth up to $2,000 per qualifying child under age 17 with a valid Social Security number.
After the first $2,500 of earnings, the child tax credit value is 15% of adjusted gross income, or AGI, until the tax break reaches that peak of $2,000 per child.
The tax break starts to phase out once AGI exceeds $400,000 for married couples filing together or $200,000 for all other taxpayers.
However, “if you have very low income, you can’t access the full $2,000 credit,” Elaine Maag, senior fellow in the Urban-Brookings Tax Policy Center, previously told CNBC.
The reason: The child tax credit is only partially “refundable,” which provides a benefit after your balance reaches $0. This feature helps the lowest earners who typically don’t owe taxes.
The refundable portion, known as the additional child tax credit, is worth up to $1,700 for 2025.
Who benefits from the child tax credit boost
If the Senate bill is enacted, the bigger child tax credit would primarily go to middle- and upper-income families, according to Kris Cox, director of federal tax policy with the Center on Budget and Policy Priorities’ federal fiscal policy division.
Currently, 17 million children do not receive the full $2,000 credit because their families don’t earn enough and owe enough taxes, the organization finds.
“Both bills leave behind children in families with lower incomes,” Cox told CNBC.
Both bills leave behind children in families with lower incomes.
Kris Cox
Director of federal tax policy with the Center on Budget and Policy Priorities’ federal fiscal policy division
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