By Ashley Burnside
On July 4, President Trump signed his reconciliation law that will make changes to the Child Tax Credit (CTC). The reconciliation law provides tax breaks for the wealthiest people by slashing Medicaid and food assistance funding, and will make changes to how states earn revenue.
The CTC is a tax credit available to eligible families with children. In 2017, lawmakers temporarily doubled the maximum credit; restricted children without Social Security numbers from being eligible; and made the credit available to families with higher incomes, among other changes. In 2021, lawmakers temporarily expanded the CTC, which helped to decrease child poverty by nearly half. These changes expired after one year. Now, President Trump’s new reconciliation bill will change how big the CTC will be and will cut some families off from accessing it.
Here are ten things you should know about the CTC:
Families who file their taxes, have an eligible child, and have incomes within the allowable limits are generally eligible to claim the CTC each year. The program is far-reaching, doesn’t require additional paperwork beyond filing taxes, and lifts millions of people out of poverty each year.
Under prior law, the maximum CTC was $2,000 per child. Beginning in 2026, the maximum credit amount will be adjusted annually for inflation.
The CTC allows parents to afford investments for their family, like summer camp, new toys, or a musical instrument. CLASP survey research concluded that in 2021 parents spent their expanded CTC monthly payments on both essentials (groceries, bills, and rent/mortgage payments) and enrichment activities for their children
Married couples making up to $400,000 per year are eligible for the maximum CTC. But because of the way the credit is structured, families with lower earnings are not eligible for the full credit. The credit phases in at 15 cents per dollar earned above $2,500 per year, and is only partially refundable. A married couple with two children needs to make at least $41,500 per year to get the full CTC, for example. An estimated 19 million children are in families who will continue to not get the full credit because their parents don’t earn enough.
An estimated 39 percent of Black children and 36 percent of Latino children didn’t get the full credit in 2023 because their parents did not earn enough. This is due to the structural and historical racism within our laws and labor market that have left communities of color with deep inequities, resulting in workers of color receiving lower wages and fewer opportunities for economic prosperity.
The 2021 law temporarily extended the age of eligibility for the credit to include seventeen-year-olds, but this provision expired after one year.
The reconciliation bill has permanently excluded children from the CTC who don’t have an SSN. This will make an estimated 1 million children ineligible for the credit, a misguided exclusion that will hurt children’s outcomes and force children and families further into poverty.
Under prior law, parents could claim the CTC for their child if they have an Individual Taxpayer Identification Number (ITIN), but the reconciliation law changed this policy. Now, at least one parent must have an SSN to claim the credit. (A married couple where one spouse has an SSN and one spouse has an ITIN would be eligible.) This will exclude an estimated 2.6 million U.S. citizen children from getting the CTC because their parents don’t have SSNs.
Under the American Rescue Plan Act of 2021, the CTC was distributed monthly to families from July through December 2021. Since that law has expired, families can now only get the credit annually when they file their tax return.
Permanently making the credit fully available to families with lower incomes; permanently increasing the size of the credit to at least the levels provided in 2021 (up to $3,600 for children ages zero through five); permanently making the credit available monthly; and permanently extending credit eligibility to seventeen-year-olds would deliver an income boost from the CTC to more than 60 million children and help families afford essentials.
The changes to the CTC passed under President Trump’s reconciliation law will cut off some immigrant families from accessing the CTC and will continue to leave families with the lowest incomes out of the full credit, disproportionately excluding Black and Latino families. The CTC doesn’t reach the families who would benefit the most from receiving it. Lawmakers should fix this backwards structure by making the credit fully available to families with low earnings and by ending the ITIN restrictions.
By Alyssa Fortner and Shira Small
Answer: Child care helps parents or caregivers work, look for jobs, attend school and trainings, and tend to other responsibilities while their children are receiving early care and education that is safe, stable, and developmentally appropriate. It is a critical support for family well-being and economic stability.
Answer: The Child Care and Development Fund (CCDF) provides child care assistance through subsidies for families with low incomes and helps improve the overall quality of care for all children in states, tribes, and territories. CCDF is made up of the Child Care and Development Block Grant (CCDBG), a discretionary funding stream (which is determined annually by Congress during appropriations) and the Child Care Entitlement to States (CCES), a mandatory funding stream (which is consistent and guaranteed funding that can only be changed through distinct legislation).
Answer: In fiscal year (FY) 2025, CCDF was funded at $12.2 billion, $8.75 billion from the CCDBG and $3.55 billion from the CCES. This is level funding from FY2024.
Answer: To draw down all available federal dollars, states are required to contribute funding toward their CCDF-funded child care assistance program through a state match and a “maintenance of effort” (MOE). Territories and tribes are exempt from this requirement. States must match their CCES dollars at their state’s Federal Medical Assistance Percentages (FMAPs) rate. MOE requires states to continue spending at least the same amount on child care services as they did prior to reauthorization of CCDBG in 1996. States can also invest more than the requirements to support their programs.
Answer: In addition to their mandatory funds from CCES, the amount of money each state and territory receives annually is calculated using a formula that considers factors like the state share of children younger than five, the state’s per capita income, and the number of children receiving free or reduced-price lunches. A portion (typically around two percent) of discretionary funding and up to two percent of mandatory funding must be reserved for tribal child care, whose funds are distributed based on a formula that considers the number of children under age 13 in the tribal service area and other program characteristics.
Answer: Yes, states can utilize Temporary Assistance for Needy Families (TANF) and Social Services Block Grant (SSBG) funds for child care. Both of these grants can be spent directly on child care, and states can also transfer up to 30 percent of TANF funds to CCDF or 10 percent to SSBG. However, the total amount transferred to CCDF and SSBG cannot be more than 30 percent of TANF funds that a state received.
Answer: Under federal law, eligible children must be age 13 or younger or up to 19 for those with disabilities or under court supervision; reside with a caregiver(s) that is working or attending school or training programs; have a family income that does not exceed 85 percent of their state median income (SMI); and is in a family who does not have more $1 million in assets. States have the ability to modify most eligibility parameters within the confines of the federal law, including, for example, establishing lower income eligibility limits. Many states do set their threshold below the federal limit of 85 percent SMI due to constrained funding.
Answer: According to the most recently published data, in FY2022, 1,434,900 children were served by CCDF in states and territories. In FY2023, the Administration for Children and Families reported that 17,000 children were served by CCDF in tribes. However, this figure is likely an underestimation because not all tribal CCDF recipients are required to report the number of children served, and tribal CCDF data is made public less frequently.
Answer: Since FY2006, the peak year for participation, to FY2022 (the most recently published data), 335,200 children lost CCDF-funded child care, because CCDF funding has not kept pace with inflation. There were 225,204 providers who accept CCDF subsidies in FY2022, a decrease of 68 percent (475,394) from 2006. This decrease is due to a variety of factors, including low reimbursement rates from CCDF, administrative burdens in the program, and a decreasing provider workforce rooted in undercompensation and inequities in the child care sector.
Answer: No. In FY2021, 11.5 million children were eligible under federal rules. Due to the flexibility states have in determining eligibility, 8 million children were eligible to be served by CCDF funds under state rules. The Office of the Assistant Secretary of Planning and Evaluation estimates that approximately 1.8 million children were reached through all funding sources in 2021. This means that only 15 percent of those eligible under federal rules and 22 percent eligible under state rules had access to assistance.
Answer: In CLASP’s most recent analysis using FY2020 data, we found that Black and Latino families are overrepresented in who is eligible for care. This means that a racial/ethnic group represents a higher proportion of all eligible children when compared to their proportion of the total population of children. This overrepresentation is a result of historical and current economic inequity within some racial and ethnic groups that has led to lower average incomes and created disproportionate need for financial assistance to afford and access child care for these children and their families. Black children had the highest rate of access and Asian and multiracial children had the lowest rates of access nationally when compared to potentially eligible children of other racial and ethnic groups.
Answer: CCDF has never been funded at the level needed to support all eligible children, and even more children could benefit from child care assistance than those who are currently eligible. To deliver on a child care system that truly meets the needs of children and families and to support the severely undervalued child care workforce, there needs to be large-scale, sustained federal investments in a system that aligns with the child care needs of children and families. With these investments, this country must confront and address the ways that racism, sexism, and classism have shaped the devaluation of child care and early education, the many other systems people rely on, and how they continue to directly harm children, families, and providers today.
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These comments were echoed by Isha Weerasinghe, director of public benefits justice at the Center for Law and Social Policy (Opens in a new window)(CLASP), a nonprofit focused on advancing policy for people with low incomes. HHS’ change will also make it difficult for healthcare and social service facilities to determine who is eligible for services, “potentially refusing to care for many more than those who are deemed ‘qualified,’ making it harder for everyone to access services,” Weerasinghe added.
This statement can be attributed to Wendy Chun-Hoon, President and Executive Director of the Center for Law and Social Policy (CLASP)
Washington, D.C., July 10, 2025 – This week, several federal agencies—including the Department of Agriculture (USDA), Department of Health and Human Services (HHS), Department of Education (ED), and Department of Labor (DOL)—issued notices regarding reinterpretation of the Personal Responsibility and Work Opportunity Reconciliation Act that restricts eligibility for some federal programs to “qualified immigrants.” These notices are in response to the Trump Administration’s executive order in February that seeks to deny federal benefits to undocumented immigrants, despite the fact that they are already ineligible for most federal benefits. These latest actions only serve to restrict access to such programs for immigrant families, including U.S. citizen children.
The Trump Administration is undermining more than 30 years of rules between federal and state governments about how grant dollars can be used. These changes will present states, counties, and cities with challenges about how they administer these programs.
Several essential programs are implicated in the HHS rule, including the community health center program, critical mental health and substance use funding for states, community services funds to bolster communities with low incomes, and funding to support foster youth. Head Start is a key program also subject to reinterpretation, potentially compromising eligibility for children in immigrant families, with grave consequences for their early learning and development. For 60 years, Head Start has ensured that children from birth to age 5 and their families have access to educational, health, and family support. Along with the programs noted above, Head Start is specifically designed to support families with low incomes, including immigrant families, by addressing both immediate and comprehensive needs. Additionally, Migrant and Seasonal Head Start helps farmworker families achieve stability and break the cycle of poverty.
Other impacts could include specific ED adult education and postsecondary career and technical education programs, along with certain DOL workforce training programs. While other programs for which immigrants are eligible, including SNAP and WIC, are not currently affected, the uncertainty and confusion around these new notices and guidances could have a wider chilling effect on numerous benefit programs.
This is just the latest assault on immigrants and immigrant families from the Trump Administration, which has used numerous executive orders and the reconciliation bill to cause great harm to immigrant children and families. Although several of these notices only reaffirm existing policy, in some cases–where eligibility is further restricted–agency guidance and possibly public comments will need to be considered before any eligibility is changed.
We urge our partners and allies to submit public comments where possible and join us in opposing efforts to strip away essential supports from immigrant families and undermine our collective well-being. We also urge community members to seek out information from trusted sources on how their eligibility for programs may be affected, including from our partners at the Protecting Immigrant Families Coalition.
This statement can be attributed to Wendy Chun-Hoon, President and Executive Director of the Center for Law and Social Policy (CLASP)
Washington, D.C., July 3, 2025 – This afternoon, the U.S. House of Representatives passed the budget reconciliation bill, which President Trump is expected to sign on July 4. This bill will cause unprecedented harm across the country, particularly to communities with low incomes, people of color, immigrants, workers, women, and children. CLASP has vociferously opposed the reconciliation bill and is busy working on a strategy for supporting the people at the heart of our mission who will be left to deal with the bill’s catastrophic cuts and spiteful policy changes. Our fight to ensure the dignity, security, and well-being of those who have been most marginalized is far from over, and CLASP is ready to meet the moment.
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Suma Setty, a senior policy analyst with the Center for Law and Social Policy and one of the report’s authors, has watched the growing government hostility against immigrant communities since President Donald Trump returned to office. Setty worries that recent enforcement actions will further restrict immigrants’ access to reproductive health care. “The fact that we’re seeing arrests in courthouses for people who are complying with the law makes it very difficult for people to even just go out.”
This statement can be attributed to Isha Weerasinghe, Director of Public Benefits Justice at the Center for Law and Social Policy (CLASP)
Washington, D.C., July 1, 2025—The budget reconciliation bill passed today by the Senate on a vote of 51-50, with Vice-President Vance casting the tie-breaking vote, will cause significant harm to millions of children and families, all for the sake of providing more tax breaks for the wealthy. The bill includes substantially more funds to accelerate the devastating immigration enforcement actions that are tearing families apart and undermining the safety and well-being of vulnerable children, including those who are U.S. citizens and asylum seekers.
The Senate’s version of the bill contains deeper cuts to Medicaid than the version passed by the House last month, excludes many lawfully present immigrants from eligibility, and expands the House’s work requirement to include some parents, which will cause millions more people to lose health insurance. This means that children and seniors, along with millions of middle-class and working families, people who need long-term care, and those who live in nursing homes will be at risk of losing their health insurance. An estimated 17 million people will lose health insurance, and 8 million people will be at risk for losing food assistance–in the same bill that gives tax breaks to billionaires and corporations.
In addition to these harmful Medicaid cuts, the bill also adds dangerous provisions to the Supplemental Nutrition Assistance Program that will restrict access, tighten eligibility, and shift major costs from the federal government to states, potentially forcing them to end their SNAP programs entirely. This represents a major threat to the health care and food assistance that millions of families depend on for their health, well-being, and stability. The bill also denies immigrants key federal benefits like Medicaid and SNAP that they contribute to, and creates barriers for them to apply for legal or permanent status by raising fees.
The bill will also cut off access to the Child Tax Credit for an estimated 2.6 million U.S. citizen children simply because their only caregiver(s) lack a Social Security number. The Institute on Taxation and Economic Policy indicates that, under this bill, the wealthiest households in the country will see an average tax cut of about $65,000, while the households with the lowest incomes will only receive an average tax cut of $110. This disparity is particularly stark, given that this bill does nothing to support the needs of families with low incomes who are especially harmed by the lack of affordable child care and increased cost of living.
The Senate bill also affects college affordability and the financial well-being of students by limiting student loans for programs and eliminating repayment options for new borrowers facing economic hardship or unemployment. The bill would also restrict access to Pell Grants for over 4.4 million students, making it harder for students with low incomes to cover costs and finish their programs.
The bill will now go to the House, whose leadership has made it clear that they will push it through as quickly as possible to meet a self-imposed July 4th deadline. Given the disregard for children, workers, immigrants, and families shown in the House’s reconciliation bill, provisions targeting the most vulnerable are likely to remain intact.
Like the House bill, the Senate’s version will harm the health, security, and well-being of communities across the country. CLASP urges House lawmakers to reject this damaging bill and focus on policies that prioritize workers, children, and families over billionaires.
By Sirisha Dinavahi – LA Post
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Mental health care is critical for families facing uncertainty. Suma Setty, a senior policy analyst with the Center for Law and Social Policy, noted that even the threat of separation could harm children: “Even just the threat [of deportation or detention of a loved one] is enough to impact a child,” she said.
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She isn’t alone. The United States does not require employers to offer paid family and medical leave and paid sick time. Workers who need time off to have a baby, care for a sick relative, or recover from injury or illness depend on the generosity of their company or state (some, including Massachusetts, Washington, and New York, have passed mandatory paid family leave in recent years). And young employees are less likely to get the benefit of employer-paid leave, according to a February 2025 report jointly published by the advocacy group A Better Balance and two non-profit policy organizations, the Center for Law and Social Policy, and the National Collaborative for Transformative Youth Policy.
This statement can be attributed to Wendy Cervantes, director of the immigration and immigrant families team at the Center for Law and Social Policy (CLASP).
Washington, D.C., June 27, 2025 – Today, the Supreme Court’s opinion in Trump v. CASA curtailed federal judges’ ability to temporarily block Trump’s birthright citizenship executive order (EO) nationwide. This EO would deny birthright citizenship to babies born without at least one parent who is a U.S. citizen or legal permanent resident. The Supreme Court also delays Trump’s EO from going into effect for 30 days.
While today’s opinion does not address the constitutionality of Trump’s birthright citizenship EO, allowing Trump to end birthright citizenship in some parts of the country within 30 days while litigation on the constitutionality of the executive order continues will cause chaos and harm babies, families, and communities.
In the 1898 decision United States v. Wong Kim Ark, the Court confirmed that U.S. citizenship was a birthright of all children born to immigrants in the United States. Now, for the first time in over a century, millions of babies born in this country may be denied automatic birthright citizenship depending on their ZIP code or their ability to prove their parents’ immigration status.
Today’s opinion has profoundly negative consequences for our nation. A large body of research has documented that U.S. citizenship is a key driver of economic growth, educational attainment, and health. Conversely, research also documents that the denial of legal status results in legal, political, economic, and social exclusion to the detriment of stateless children and to the United States.
Even as litigation continues on the constitutionality of the EO itself, families welcoming a new baby in some parts of the country may soon be required to prove their child’s citizenship. This burden will affect not only mixed-status immigrant families but all families in the impacted jurisdiction, undermining the well-being of newborn babies and their parents. Single mothers, families with low incomes, and families of color will be disproportionately impacted by this requirement.
This fight is far from over, and CLASP stands ready to work with partners to ensure that impacted families and service providers are informed about their rights. We urge the Court to uphold the Fourteenth Amendment and rule that Trump’s executive order is unconstitutional. We also call on federal and state policymakers to stand up against the Trump Administration’s reckless attacks on immigrant families and commit to protecting every child born in the United States.