To amend the Internal Revenue Code of 1986 to increase the earned income tax credit, child tax credit, and for other purposes.
Analysis under review: This bill has generated analysis that may be too generic or incomplete. Clause-level evidence remains available below.
Summary
What This Bill Does
The bill expands earned income tax credit by increasing credit percentages (38-45%), expanding earned income amounts ($15K-$20K), raising phaseout thresholds ($40K-$47K), and adding inflation indexing after 2027, creates new Section 36D making child tax credit fully refundable: $2,000 for up to 3 qualifying children plus $500 for additional children, with income phaseout starting at $110K joint/$75K single, inflation-indexed, and creates full statutory text for new Section 36D child tax credit including definitions, SSN requirements, fraud penalties, application to U.S. territories (Puerto Rico, American Samoa, mirror code possessions). It relies on tax deductions, tax credits, and tax rate changes. The main policy areas are Taxation, Education, Finance, and Transportation.
Who Benefits and How
Parents with children under 7 in daycare could see lower costs, Parents paying daycare tuition could see lower costs, and Low-income workers with 2+ qualifying children could see lower costs.
Who Bears the Burden and How
Treasury (refundable credit payments) could face higher costs, High-income investors subject to 20% capital gains rate could face higher costs, and Treasury (reduced revenue) could face higher costs.
Key Provisions
- Expands earned income tax credit by increasing credit percentages (38-45%), expanding earned income amounts ($15K-$20K), raising phaseout thresholds ($40K-$47K), and adding inflation indexing after 2027.
- Creates new Section 36D making child tax credit fully refundable: $2,000 for up to 3 qualifying children plus $500 for additional children, with income phaseout starting at $110K joint/$75K single, inflation-indexed...
- Creates full statutory text for new Section 36D child tax credit including definitions, SSN requirements, fraud penalties, application to U.S. territories (Puerto Rico, American Samoa, mirror code possessions)...
- Expands medical expense deduction by removing the AGI floor and allowing non-itemizers to claim it as an above-the-line deduction, effective for taxable years after 2026.
- Creates new Section 224 above-the-line deduction for qualified daycare expenses (tuition for dependents under age 7 at licensed childcare institutions), effective after 2026.
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers with clause-level evidence links.
At a Glance
What This Bill Does
The bill expands earned income tax credit by increasing credit percentages (38-45%), expanding earned income amounts ($15K-$20K), raising phaseout thresholds ($40K-$47K), and adding inflation indexing after 2027, creates new Section 36D making child tax credit fully refundable: $2,000 for up to 3 qualifying children plus $500 for additional children, with income phaseout starting at $110K joint/$75K single, inflation-indexed, and creates full statutory text for new Section 36D child tax credit including definitions, SSN requirements, fraud penalties, application to U.S. territories (Puerto Rico, American Samoa, mirror code possessions).
Key Policy Areas
Taxation, Education, Finance, Transportation
Primary Purpose
The bill expands earned income tax credit by increasing credit percentages (38-45%), expanding earned income amounts ($15K-$20K), raising phaseout thresholds ($40K-$47K), and adding inflation indexing after 2027, creates new Section 36D making child tax credit fully refundable: $2,000 for up to 3 qualifying children plus $500 for additional children, with income phaseout starting at $110K joint/$75K single, inflation-indexed, and creates full statutory text for new Section 36D child tax credit including definitions, SSN requirements, fraud penalties, application to U.S. territories (Puerto Rico, American Samoa, mirror code possessions).
Policy Domains
Main Bill - Tax Relief Provisions
Identified Gains
- Parents with children under 7 in daycare
- Parents paying daycare tuition
- Low-income workers with 2+ qualifying children
- Low-income workers with 1 qualifying child
- Individuals with significant medical expenses
Identified Costs
- Treasury (refundable credit payments)
- High-income investors subject to 20% capital gains rate
- Treasury (reduced revenue)
- Treasury/IRS (regulation and verification)
Sponsors
Legislative Progress
IntroducedMrs. Cherfilus-McCormick (for herself, Mrs. McIver, Mr. Johnson of Georgia, …
Stakeholder Effects
cui bono?How this legislation distributes effects. Mention counts reflect frequency, not effect magnitude.
Credit card holders paying interest, Families with 1-3 qualifying children under age 17, Families with more than 3 children
Positive-direction: Credit card holders paying interest, Families with 1-3 qualifying children under age 17, Families with more than 3 children, Families with qualifying children, Individuals with credit card debt, Individuals with forgiven or discharged debt, Individuals with significant medical expenses, Low and moderate-income renters, Low-income workers with 1 qualifying child, Low-income workers with 2+ qualifying children, Low-income workers without children (singles and joint filers), Non-itemizing taxpayers with medical costs, Parents of students at Title I/charter schools, Parents paying daycare tuition, Parents paying for tutoring at Title I schools, Parents with children under 7 in daycare, Public transit commuters under income thresholds, Puerto Rico residents, Renters under income thresholds, Workers commuting by public transit
Negative-direction: High-income investors subject to 20% capital gains rate
American Samoa, Treasury (increased revenue), Treasury (reduced revenue)
Positive-direction: American Samoa, Treasury (increased revenue), U.S. Territories with mirror code tax systems
Negative-direction: Treasury (reduced revenue), Treasury (refundable credit payments), Treasury/IRS (regulation and verification)
Students at Title I and charter schools, Tutoring service providers
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_secretary"
- → Secretary of the Treasury
Key Definitions
Terms defined in this bill
$15,000 for 1 child, $20,000 for 2+ children, $10,000 joint/$8,500 other for no children
Qualifying child under section 152(c) who has not attained age 17 and is a citizen or resident
Tuition for dependent under age 7 to attend a childcare institution per 45 CFR 1355.20
Amounts paid for public transit between principal residence and workplace (20+ hours/week)
Tutoring for dependents at public Title I schools or charter schools, up to $2,500
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology