Child Tax Credit Could Be Stripped From Millions of Children

A new budget proposal that would impose new restrictions on the federal Child Tax Credit could eliminate the benefit for millions of U.S. citizens or legally resident children, policy experts have said.

Proposed under the One Big Beautiful Bill Act, the rule would require both the tax filer and their spouse to have Social Security numbers in order to claim the Child Tax Credit (CTC) for their children. As a result, children with mixed-status parents — for instance, one parent who is a U.S. citizen and another who is not — would lose eligibility for the credit, according to Carl Davis, research director at the nonpartisan Institute on Taxation and Economic Policy (ITEP).

Policy experts and researchers from the Center for Migration Studies have estimated that around 4.5 million children — primarily in California, Texas, and Florida — could lose access to CTC if the rule changes are implemented.

“The proposal now is actually to tighten the eligibility rules even more and to say, ‘We basically don’t care if the child is a citizen or not — we need every person in the household to be a citizen or otherwise have legal status in order for the credit to be paid out,'” he told CBS News.

Why It Matters

The CTC, first introduced in 1997, offers families up to $2,000 for every eligible child under the age of 17 with a valid Social Security number. Under current rules, only the child’s Social Security number is required, not the parents’.

The credit is a key tool in reducing child poverty across the U.S., helping families cover essential expenses such as food, clothing, and school supplies.

What To Know

Under the new Republican legislation, part of the One Big Beautiful Bill Act, parents would only be eligible to claim the CTC if both the filer and their spouse possess Social Security numbers.

The stipulation would bar eligibility for families with undocumented parents or parents on non-working visas, as well as families where only one parent can obtain a Social Security number. Most undocumented migrants are already barred from most federal tax credits.

Analysts warn that the policy would largely impact U.S. citizens and legally resident children living with non-citizen parents.

In addition to the CTC, the proposal would tie the eligibility requirement to other tax benefits, such as provisions that eliminate taxes on worker tips and overtime pay.

Shelby Gonzales, vice president for immigration policy at the Center on Budget and Policy Priorities, argued that the bill would “treat children differently based on the immigration status of their parents.”

Republicans plan to boost the CTC to $2,500 for 2025 through 2028. GOP lawmakers backing the proposal contend that increasing the credit and adjusting it for inflation would provide relief to American families, while the new restrictions would prevent taxpayer benefits from going to households with undocumented members.

What People Are Saying

House Ways and Means Committee Chairman Jason Smith said the bill would “increase the Child Tax Credit, the standard deduction and the Death Tax exemption,” aiming to restrict access for undocumented immigrants.

Carl Davis, research director at ITEP, told CBS News: “We basically don’t care if the child is a citizen or not — we need every person in the household to be a citizen or otherwise have legal status in order for the credit to be paid out.”

George Carrillo, former director of social determinants of health for Oregon and CEO of the Hispanic Construction Council,told Newsweek that the bill “strives to deliver immediate financial relief to many American families,” but also “raises concerns about fairness and long-term impact.”

“Immigration-related provisions restricting access to tax credits disproportionately harm vulnerable communities, while a $4 trillion debt increase raises questions about fiscal responsibility and passing burdens onto future generations,” he said.

Shelby Gonzales, vice president for immigration policy at the Center on Budget and Policy Priorities, told CBS News: “It seems to say, if your parents don’t meet this criteria regarding their immigration status, then you will be treated differently as a child than all other children in the U.S. who were born of two parents that meet the qualifications.”

What Happens Next

The budget package passed the House by a narrow margin and is under review in the Senate, where some lawmakers have voiced opposition on fiscal grounds.

The bill could undergo substantial changes as the legislative process continues.