The IRS has officially released its 2026 tax year updates — and for families, the headline news is all about the Child Tax Credit (CTC).
Under the One Big Beautiful Bill Act (OBBBA), signed into law in July 2025, the credit is now permanent, higher, and inflation-adjusted — a historic change that’s expected to help more than 40 million families.
The new credit is worth $2,200 per qualifying child, with up to $1,700 refundable for those who owe little or no tax. This means families will finally see the credit rise alongside the cost of living each year.
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1. The Child Tax Credit now adjusts for inflation.
For the first time in nearly 30 years, the Child Tax Credit will automatically increase each year to match inflation. That means as prices rise, so will the value of your credit, protecting families from losing purchasing power over time.
The main credit rises to $2,200 per qualifying child for 2026, while the refundable portion (the part you can get even if you owe no taxes) stays at $1,700 for now but will also grow with inflation in future years.
Financial experts say this change gives families more stability.
2. As of 2026, the credit is now permanent.
Until now, the Child Tax Credit has been one of the most frequently modified provisions in the tax code, with temporary increases and sunset dates creating uncertainty for families. The One Big Beautiful Bill Act ends that cycle by making the CTC permanent, a major shift that locks in both the higher credit amount and the new inflation indexing.
This permanence means families can plan their finances with more confidence, knowing the benefit won’t disappear after a few years of legislative debate.
3. Income phase-out limits remain the same.
While the credit itself increases, the income limits do not. The credit still begins to phase out for taxpayers earning above $200,000 (single or head of household) and $400,000 (married filing jointly). Those thresholds aren’t tied to inflation, meaning that as wages rise, more families could gradually lose some or all of their credit eligibility over time.
Tax professionals suggest that households approaching these limits review their adjusted gross income carefully — especially if raises, bonuses, or additional income could push them over the threshold.
4. New Social Security number requirements are in effect.
Starting with 2026 returns, both the taxpayer and each qualifying child must have valid Social Security numbers (SSNs) issued before the tax return’s due date to claim the credit.
For married couples filing jointly, at least one spouse must have an SSN, though the other may use an ITIN. Families that don’t meet the SSN requirement can still claim the Credit for Other Dependents, worth up to $500 per dependent.
What hasn’t changed in 2026?
The basic eligibility rules for who counts as a qualifying child remain the same. Children must be under 17 at the end of the tax year, have lived with you for more than half the year, and have a valid SSN. Dependents who turn 17 in 2026 will no longer qualify for the Child Tax Credit but may still be eligible for the $500 Credit for Other Dependents.
Where to learn more
These updates change how the credit is calculated, not how you file. You’ll still claim the Child Tax Credit using Form 1040 and Schedule 8812 when you file your 2026 return.
For full details on eligibility, income limits, and step-by-step filing guidance, visit our comprehensive guide: Understanding the Child Tax Credit.