Big Beautiful Bill Expands Child Tax Credit to $2,500

The Big Beautiful Bill passed by House Republicans expands the Child Tax Credit to $2,500 per child, effective immediately for tax year 2025.

This $500 increase from the current $2,000 child tax credit delivers meaningful relief to working and middle-class families.

The credit phases out at $200,000 for single filers and $400,000 for married couples filing jointly, keeping the benefit focused on middle-income households.

The expanded child tax credit will help tens of millions of households. Expansion to $2,500 per child means more room in the budget for groceries, child care, school supplies, and savings, helping parents plan for their children’s future.

As House Ways and Means Committee Chairman Jason Smith noted, the expansion delivers targeted relief while reinforcing the value of work.

To claim the credit, the taxpayer and child must have a valid Social Security number. The bill also allows use of prior-year income to determine eligibility, a key safeguard for those affected by job loss or wage cuts.

Overall, the bill provides Americans making $30,000 – $80,000 with a 15% tax cut.

The bill provides across-the-board income tax cuts and an expanded standard deduction, abolishes the Biden-era Venmo tax, abolishes the tax on tips and overtime, and provides pro-growth, job-creating tax cuts for American businesses.

More details below:

List of Tax Cuts in the Big, Beautiful Bill

Big Beautiful Bill Repeals IRS 1099-K Venmo Tax

Big Beautiful Bill Provides Income Tax Cuts and Tax Simplification Through Expanded Standard Deduction

No Tax on Tips in the Big Beautiful Bill Will Help Millions of Americans

Big Beautiful Bill Expands Health Savings Accounts to 20 Million People

Big Beautiful Bill’s Opportunity Zone Tax Cuts Will Help Distressed Areas Across All 50 States