Skip to content

Basics

Updated Child Tax Credit

Workforce

Published on March 25, 2025

Explore This Basic

The Child Tax Credit (CTC) is a fundamental element of U.S. financial policy, offering crucial economic relief to American families with dependent children. Established in 1997 during the Clinton administration, the CTC was initially introduced as a partially refundable tax credit. This nonrefundable credit provides taxpayers with dependent children under the age of seventeen the opportunity to reduce their tax liability on a dollar-for-dollar basis, potentially eliminating the tax debt in its entirety. Over the years, the CTC has evolved, expanding its scope and benefits and making it a key tool in the federal government’s efforts to support families.

In 2025, the Child Tax Credit (CTC) will continue to provide financial support to families with qualifying children. The maximum credit amount remains set at $2,000 per child for those under the age of 17, with up to $1,600 of the credit being refundable. This means eligible families can receive the refundable portion even if they do not owe federal income taxes. It is important to note the provisions of the Child Tax Credit in 2025 are temporary, with current law set to revert to a $1,000 credit per child beginning in 2026 unless new legislation is introduced. This potential reduction highlights the ongoing political discussions surrounding the CTC and its role in economic policy, with debates continuing over the extent and duration of such tax relief. 

Read the Full Basic

Links to Other Resources: