The Child Tax Credit (CTC) is one of the most widely used family tax benefits, and for good reason. It puts real money back into the pockets of parents raising children, helping offset the costs of food, clothing, education, and more. For 2025, the CTC gets a boost under the One Big Beautiful Bill Act.
What’s New for 2025
The credit increases from $2,000 to $2,200 per qualifying child. While $200 may not seem like much at first glance, it adds up quickly for families with multiple children. For example, a family with three children under age 17 could see their credit increase by $600 compared to last year.
Beginning in 2026, the CTC will also be indexed for inflation. That means it will rise automatically in future years without requiring Congress to pass new legislation, ensuring the credit keeps pace with the rising cost of living.
Who Qualifies
- Children must be under age 17 at the end of the year.
- The child must live with you for more than half the year.
- You must claim the child as a dependent on your return.
- The child must have a valid Social Security number.
Income limits apply: the credit begins to phase out for single filers earning over $200,000 and married couples earning over $400,000.
Refundable Portion
Another key feature is the refundable amount. Even if your tax bill is reduced to zero, you may still receive part of the credit as a refund. For many military families, especially junior enlisted service members with modest incomes, this refundable portion can make a big difference.
What This Means for Military Families
Military families often face higher child-related expenses due to frequent moves and deployments. Whether it’s new school supplies after a PCS or child care while a spouse is deployed, every dollar counts. The expanded Child Tax Credit offers direct financial relief where it’s needed most.
At PIM Tax Services, we’ll ensure your family receives the full credit you qualify for—nothing left on the table.