Claiming a Child Under the Big Beautiful Bill

 Posted on September 01, 2025 in Claim a Child IRS

Since the passing of the Big Beautiful Bill, several key changes were made to support families and education savings.*

The Child Tax Credit slightly increased to $2,200 per child beginning in 2025 and is now indexed to inflation, meaning it will automatically rise over time. The bill also makes permanent the higher income phaseout thresholds, allowing more families to qualify for the full credit: $200,000 for single filers and $400,000 for joint filers.

The law also expands how families can use 529 plan funds. Starting in 2025, 529 accounts may be used for a much wider range of educational expenses beyond college tuition and fees. Qualified expenses now include credentialing and licensing programs, testing fees, continuing education, books and materials, tutoring, online learning tools, and certain educational therapies. Covered credential programs extend to both professional and trade certifications, such as CPA or bar exam preparation, CDL training, welding, HVAC, and cosmetology (read more here). Beginning with tax years in 2026, the annual withdrawal limit for K–12 education doubles from $10,000 to $20,000 per child. 

Depending on your situation, these updates may give your family more control and flexibility over how you save and spend for your children’s education. Together, the higher child tax credit and expanded 529 rules could make contributing to a 529 plan more attractive by increasing its usefulness for both traditional and non-traditional learning paths. 

Obviously, every family’s circumstances are unique. If you have any questions surrounding claiming your child or what new legislation means for your family, please contact Monica Scherer and Silverman Thompson to find out how we can assist.

You can reach Ms. Scherer and the family law team at mscherer@silvermanthompson.com or toll-free at 800-385-2243.

*Silverman Thompson does not hold themselves out as being experts in tax-related matters, and therefore it is recommended that before any action is taken you should receive competent tax advice from an independent tax professional.