Millions of working families rely on family tax credits like the child tax credit (CTC) to support household bills like food, housing, child care, and education.
Claiming these and other federal tax credits and deductions like the adoption credit and the Earned Income Tax Credit (EITC) can lower your tax liability or increase your refund amount.
The amount of certain tax credits and deductions can also change since many are adjusted yearly for inflation. Not to mention, it’s also an election year, and some family credits like the child tax credit may be subject to change depending on who makes it to the Oval Office.
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Here are the new 2025 tax year amounts (these apply to federal returns normally filed in early 2026).
Child tax credit 2025
For the 2025 tax year, the IRS has just announced that the refundable portion of the CTC is $1,700. That’s the amount you can claim for tax returns you generally file in 2026.
However, the TCJA’s version of the CTC is set to sunset and once it does, if Congress doesn’t act, the credit will revert to $1,000 per qualifying child in 2026, and the age limit for eligible children will decrease to 16.
For the 2024 tax year (returns you’ll file soon, in early 2025), the refundable portion of the credit is also $1,700. For more information about the current child tax credit, see How Much is The Child Tax Credit for 2024?
Depending on who wins the 2024 election, the future of the child tax credit could likely experience some changes.
Your family could also be eligible for a state child tax credit.
Currently, fifteen states plus the District of Columbia provide their version of the child tax credit. States with fully refundable CTC include California, Colorado, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, New Mexico, Oregon, and Vermont.
Meanwhile, Arizona, Idaho, Oklahoma, and Utah offer nonrefundable credits. More states could join, so it’s important to stay tuned to your local government’s decisions on this family tax credit.
For more information, see: Does Your State Have a Child Tax Credit for 2024?
Adoption tax credit 2025
The federal adoption tax credit for the 2025 tax year (taxes generally filed in 2026) is worth up to $17,280 (up from $16,810 for 2024).
The tax benefits for adoption include a tax credit for qualified adoption expenses paid to adopt a child and an exclusion from income for employer-provided adoption assistance.
Most importantly, the credit is nonrefundable, meaning it’s limited to your tax liability for the year. Any amount that exceeds your tax liability can be carried forward for up to five years, and the amount is adjusted for inflation every year.
The amount you can claim will depend on your modified adjusted gross income (MAGI). For tax year 2024 (returns typically filed in 2025), the credit phases out with MAGI between $252,150 and $292,150. For the 2025 tax year, the credit phase-out begins at $259,190 and phases out completely at $299,190 or above.
Keep in mind, that there are some limitations, including a special needs exception.
Earned Income Tax Credit (EITC) 2025
The Earned Income Tax Credit is a refundable tax credit that is available for people with an earned income below a certain threshold.
How much you get will depend on your filing status, the number of qualifying children in your household, and earned income.
For 2025, the credit is worth up to $8,046 (up from $7,830 for 2024) with three qualifying children, $7,152 (up from $6,960) with two qualifying children, $4,328 (up from $4,213) for one qualifying child, and $649 (up from $632) with no qualifying children.
Additionally, for taxable years beginning 2025, you won't be eligible for the EITC if your investment income exceeds $11,950.
Here are the income phaseout amounts for claiming the EITC for tax year 2025 (typically filed in 2026).
| Number of children or relatives claimed | Married filing jointly Phase-in Amount | Married filing jointly Phase-out Amount | Earned Income Amount | Maximum Amount of Credit |
| Zero | $17,730 | $26,214 | $8,490 | $649 |
| One | $30,470 | $57,554 | $12,730 | $4,328 |
| Two | $30,470 | $64,430 | $17,880 | $7,152 |
| Three or more | $30,470 | $68,675 | $17,880 | $8,046 |
| Row 5 - Cell 0 | Row 5 - Cell 1 | Row 5 - Cell 2 | Row 5 - Cell 3 | Row 5 - Cell 4 |
| Row 6 - Cell 0 | Row 6 - Cell 1 | Row 6 - Cell 2 | Row 6 - Cell 3 | Row 6 - Cell 4 |
| Number of children or relatives claimed | All other filers Phase-in Amount | All other filers Phase-out Amount | Earned Income Amount | Maximum Amount of Credit |
| Zero | $10,620 | $19,104 | $8,490 | $649 |
| One | $23,350 | $50,434 | $12,730 | $4,328 |
| Two | $23,350 | $57,310 | $17,880 | $7,152 |
| Three or more | $23,350 | $61,555 | $17,880 | $8,046 |
You may also be eligible for an earned income credit on your state tax return. Some states and the District of Columbia and New York City, offer versions of the earned income credit.
To see if your state offers an earned income credit and whether you are eligible, you can visit the IRS information page on state and local governments with earned income tax credits.
Child and Dependent Care Tax Credit
As many key TCJA provisions are set to expire by the end of next year, tax policy experts say this could be an opportunity for lawmakers to usher in much-needed reforms for family tax credits.
The Child and Dependent Care Tax Credit (CDCT), for example, has remained unchanged for more than ten years. Under current law, the credits are non-refundable and families are eligible for the following:
- $3,000 (one child) or $6,000 (two or more children)
- 35% for taxpayers with adjusted gross income between $0 and $15,000
- 20% to 35% for taxpayers earning between $15,000 and $43,000
- 20% for those earning over $43,000 annually
What comes next for family tax credits
Taxpayers are likely to face a unique set of circumstances that could impact eligibility standards and the amount of credits they are eligible for in upcoming years.
As an election year, both the Democratic and Republican presidential candidates have floated proposals that could enhance key tax breaks for families, including:
- The Child Tax Credit
- The Earned Income Child Tax Credit
- The Child Care and Dependent Tax Credit
All else aside, temporary expansions to the CTC are slated to expire in 2026 unless Congress acts soon. As reported by Kiplinger, these changes will mean many families will get fewer tax credits and fewer children will be eligible.
With family tax credits as a pocketbook issue at the federal and state level, it’s important to stay informed about changes that can directly impact your household’s financial well-being.
To see if you’re eligible for some of these tax breaks, you can talk to a trusted certified financial professional or tax advisor.
During tax season, the IRS also has Volunteer Income Tax Assistance(VITA) clinics, which offer help free of charge to select groups.
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