The US Congress recently passed the ambitious tax package known as “The One, Big, Beautiful Bill“, a proposal pushed by Republican lawmakers and backed by President Donald Trump.
This legislation represents the largest tax cut in the country’s history, and one of its most visible components is the expansion of the Child Tax Credit (CTC), which will benefit more than 40 million American families.
How much will the Child Tax Credit increase?
With the passage of the Big Beautiful Bill, the Child Tax Credit is increased to $2,500 per child, consolidating and expanding the temporary increase implemented in previous tax reforms. This figure represents a significant increase over the previous credit of $2,000 per child.
Furthermore, the new credit is made permanent, ensuring greater financial stability for working families. The requirement for a Social Security number remains in place to ensure that the benefit is only available to citizens and legal residents.
Who will benefit?
The new credit is intended to benefit low- and middle-income families, particularly those earning less than $100,000 annually. According to the House Ways and Means Committee, these families will receive an average tax cut of $1,300 from the combination of the child credit and other tax breaks.
Families with incomes between $15,000 and $30,000 will receive a tax cut of up to 21%, the largest proportional cut of any income group.
Other tax benefits included in the Big Beautiful Bill
In addition to increasing the CTC, the Big Beautiful Bill includes a series of measures that seek to reduce the tax burden on workers:
Increased and permanent standard deduction, benefiting 91% of taxpayers.
Tax exemption on tips and overtime, which will increase the net income of millions of hourly workers.
Expansion of child care credit and paid leave tax credits to support working parents.
Health and education savings accounts more accessible, including new “Trump” savings accounts for children from birth.
Projected economic impact
Proponents of the project argue that the reforms will not only reduce the tax burden but also stimulate economic growth. The package is expected to create up to 1 million new jobs annually and raise real wages by up to $7,200 per worker.
In addition, a typical family of four’s disposable income is expected to rise by $10,900 per year as a result of tax cuts and economic growth.
The Big Beautiful Bill represents a significant shift in US fiscal policy, with a strong emphasis on helping working families. The increase in the Child Tax Credit to $2,500 provides direct relief to millions of households, while other measures aim to strengthen the family economy.
Although the political debate continues, this tax package is already generating positive expectations among parents, workers, and small businesses looking for greater stability and purchasing power in an uncertain economic environment.
