Just about everyone is a fan of the Child Tax Credit, and under the current proposed version of the “One Big Beautiful Bill” that’s with the Senate, there are a number of potential changes that could be coming:
•Increased Credit: The proposed bill would increase the credit amount, from $2,000, to $2,500 (through 2028)
•Newborn Credit: While technically separate from the CTC, the BBB is also proposing that children born 2024 – 2028 would receive a $1,000 contribution into a “MAGA” account (Money Accounts for Growth and Advancement). This is a new type of account that would allow withdrawals for education, entrepreneurship, or homeownership.
•Inflation Adjustment: The credit would be indexed for inflation, ensuring its value doesn’t decrease over time (starting in 2029).
Taxpayers should be aware of other proposals that could make it more difficult to take the credit:
•SSN Mandate: Today only the child needs a SSN# for a family to claim the credit, but under the proposed bill, every family member would need a SSN# to claim the credit
•Qualifying Certificate: Another new provision would require that starting in 2028, parents must obtain a “qualifying certificate” before filing, adding an extra step to the process.
While these changes are still just proposals, staying informed is key. The rules can be complex, and being proactive will help you navigate whatever comes next!