We are entering a new era in America, with changes in the federal government’s focus and approach to financial allocations and tax breaks, among other stimulus tools used throughout the country’s history to provide impulses to the most vulnerable families.
The Child Tax Credit (CTC) is one of the programs that could change as Donald Trump begins his second term in the White House.
Following the president’s implementation of the Tax Cuts and Jobs Act of 2017 (TCJA), the credit increased to $2,000 for each child under the age of 17.
These provisions will expire after 2025 unless Congress intervenes, potentially impacting tax returns in 2027.
What could change in the CTC stimulus payment?
In 2017, the TCJA increased not only the CTC but also the phaseout thresholds for higher-income families. While this measure sought to provide broader relief, it also sparked debate about equitable benefit distribution.
The risk to this program is that the expiration date of these provisions is approaching, and its future is uncertain. The credit reduction could cause a significant drop, raising concerns among lawmakers about the impact on families.
For the time being, a portion of the CTC is refundable, which means recipients can receive a refund even if they do not owe any taxes. However, the proposed changes may limit this feature, emphasizing tax reduction for taxpayers.
Despite being approved by the House of Representatives, the proposal to expand access to the CTC and make retroactive payments for the refundable portion for 2023 was rejected by the Senate.

How to claim the Child Tax Credit in 2024-2025
The child tax credit is a benefit designed for people with dependent children under the age of 17, with a maximum of $2,000 per child. Eligibility for this credit is determined by the child’s marital status, income, and caregiver relationship.
High income may result in credit reduction or ineligibility because the credit is gradually reduced based on modified adjusted gross income (MAGI).
For 2024, the child tax credit’s maximum value remains $2,000, with a refundable portion of up to $1,700. The MAGI thresholds remain at $400,000 for married couples filing jointly and $200,000 for other filers. Exceeding these limits results in a $50 reduction for every $1,000 of additional income, until the credit is eliminated.
In 2025, the credit will be $2,000 with a $1,700 refundable portion, and income thresholds will remain unchanged. However, unless an extension is approved, the credit will be reduced to $1,000 in 2026, and income thresholds will be reset to pre-2017 levels.
To be eligible, an applicant must meet seven criteria, including the child’s age, relationship, dependency status, residency, financial support, citizenship, and income requirements.
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