Bipartisan tax deal could boost child tax credit for 2023. What it means for families this tax season

While less generous than the enhanced child tax credit ruled during the Covid-19 pandemic, the changes would boost the maximum refundable tax break to $1,800 per child for 2023, up from the fashionable 2023 limit of $1,600. The limit would increase to $1,900 for tax year 2024, and $2,000 for tax year 2025, along with inflation harmonies.

The new law would expand refundable credit eligibility for larger families and if income drops in 2024 or 2025, taxpayers can use earnings from the until year to calculate their maximum credit.

“It’s extremely well-targeted to provide significant relief to millions of low-income orders,” said Chuck Marr, vice president for federal tax policy for the Center on Budget and Policy Priorities.

If enacted, the submitted legislation could benefit roughly 16 million children in low-income families during its first year, according to a prediction released Tuesday from the Center on Budget and Policy Priorities.

Childhood poverty more than doubled in the U.S. in 2022 — billow to 12.4% compared to 5.2% in 2021 — after pandemic relief expired.

With introduced retroactive changes for 2023, there’s pressure to enact the legislation by the