If, every year, you rely on the Child Tax Credit to ease your taxes, there is a proposal from the Internal Revenue Service that deserves your attention. Not because it is a new rule, but precisely because it is still in process and could change how some immigrants receive the refundable portion of the credit.
The deadline to submit comments on the proposal expires on October 5, 2026. A public hearing is planned for October 14. The process isn’t finished yet, but the potential economic impact is significant enough not to overlook.
What is the IRS proposing for the Child Tax Credit?
The proposal REG-119882-25, issued by the Department of the Treasury and the IRS, suggests treating the refundable portion of certain tax credits as a “federal public benefit” under a 1996 law.
The change is not limited to the Child Tax Credit. It also contemplates:
The delicate point lies in the part of the credit that can be paid back to you. According to the IRS itself, the proposal would prevent receiving that refundable portion for those who do not fall into the immigration category of a “qualified alien.”
Who could still receive the money?
The proposal lists as “qualified aliens,” among others, certain permanent residents with a Green Card, refugees, people who were granted asylum, and some parolees of at least one year.
Additionally, there is a relevant detail for families filing a joint return: if one spouse is a U.S. citizen, a U.S. national, or a qualified alien, the other would be considered a qualified alien for this regulation.
That means it isn’t enough to simply ask whether you are an immigrant. Your specific immigration status and how you file your taxes can make the difference.
How much money is at stake?
The Child Tax Credit can represent a substantial amount for a family.
For the 2025 tax year, the CTC goes up to $2,200 per qualifying child, while up to $1,700 per child may correspond to the refundable portion through the ACTC, depending on the taxpayer’s circumstances. This is stated by the IRS in its tax instructions.
And here is the distinction to keep in mind: the proposal would not automatically eliminate the entire Child Tax Credit for a person who does not meet the immigration definition. The approach focuses on the portion paid as a refund. The credit could still be used to reduce the tax owed, subject to applicable conditions.
Is the change already in effect?
No. And this is probably the most important clarification to avoid confusion.
What exists now is a regulatory proposal. The comment period ends on October 5 and there is a public hearing scheduled for October 14. After that, the Treasury and the IRS will need to review the comments before deciding on the final text.
Therefore, if you have the Child Tax Credit and you are an immigrant, you should not assume that you will automatically lose your next refund. The rule can still change.
That said: it is worth learning about it now. When we are talking about a benefit that can represent hundreds or even thousands of dollars for a family, waiting until the tax return is in front of you can be too late to understand what changed.
