One Big Beautiful Bill (OBBB) Act: New Changes to the Child Tax Credit

February 13, 2026

On July 4, 2025, the One Big Beautiful Bill (OBBB) Act was signed into law. While the Act covers various tax provisions, one of the most significant changes for families is the permanent extension and increase of the Child Tax Credit (CTC). 

Here is what business professionals need to know about the new rules effective for the 2025 tax year. 

Key Changes at a Glance 

• Increased Credit Amount: The maximum credit has increased to $2,200 per qualifying child (up from the previous $2,000). This amount will be adjusted for inflation in future years.  

• Qualifying Child: To qualify for a child tax credit, the dependent must be a U.S. citizen, national, or resident under age 17 at the end of the year who possesses a valid Social Security Number. 

• Other Dependent Credit (ODC): The $500 credit for other dependents (such as dependents with individual tax identification number, college students or elderly parents) is now permanent. 

• Refundable Portion: If the credit exceeds your tax liability, up to $1,700 is refundable in 2025. 

Income Thresholds Made Permanent A major benefit of the new Act is the preservation of higher income thresholds. Under previous laws, these thresholds were scheduled to drop significantly after 2025. The OBBB Act locks in the current "phase-out" levels, meaning you can earn more while still claiming the full credit: 

• Married Filing Jointly: Full credit available for Adjusted Gross Income (AGI) up to $400,000. 

• All Other Filers: Full credit available for AGI up to $200,000.