The refundable portion of the child tax credit — a tax break parents can take for qualifying children — will be $1,700 for 2025, which is unchanged from 2024. That figure represents how much families may claim even with zero tax balance on their tax returns.

The maximum child tax credit of $2,000 per child under 17 is available to parents with up to $400,000 in modified adjusted gross income if they are married and filing jointly, or under $200,000 if they are single. Those figures are also unchanged from 2024.

Notably, the terms of the current child tax credit are set to expire at the end of tax year 2025. At that time, the child tax credit is scheduled to drop to a maximum $1,000 per child.

However, lawmakers on both sides of the aisle have touted proposals to make the credit more generous.

The new changes for 2025 are standard adjustments for inflation so taxpayers don’t face higher tax liabilities, according to Alex Durante, economist at the Tax Foundation. The terms still reflect the Tax Cuts and Jobs Act of 2017.

“But the year following, 2026, families should be expecting to see higher tax liabilities unless Congress votes to extend these tax provisions that were implemented in 2017,” Durante said.

A tax credit for low- to middle-income individuals and families — the earned income tax credit, or EITC — will have higher maximum amounts in 2025.

The earned income tax credit helps qualifying individuals and families reduce the amount of tax they owe, while also potentially providing a refund, according to the IRS.

In 2025, the maximum EITC amount will be $8,046 for qualifying taxpayers with three or more eligible children. That is up from $7,830 for tax year 2024.

The maximum amount available for qualifying taxpayers with two eligible children will be $7,152, up from $6,960 in 2024; one qualifying child, $4,328, compared with $4,213 in 2024; and no qualifying children, $649, up from $632 in 2024.

To qualify for the tax credit, individuals and families must be under certain thresholds for adjusted gross income — defined as total income excluding any eligible deductions.

In 2025, the maximum AGI to qualify for the EITC for married couples with three or more children will be $68,675, up from $66,819 in 2024; and for single, head of household and widowed filers with three or more children it will be $61,555, adjusted from $59,899 in 2024. The EITC is also subject to phaseout thresholds.

Taxpayers are also limited to how much investment income they can have in order to qualify for the earned income tax credit. In 2025, that threshold will go to $11,950, up from $11,600 in 2024. If investment income is above $11,950 in 2025, taxpayers will not qualify for the credit.

Other changes announced by the IRS may also affect families.

The maximum adoption credit for a child, including those with special needs, will apply to qualified expenses of up to $17,280 in 2025, up from $16,810 in 2024.

The annual exclusion for gifts will go up to $19,000, up from $18,000 in 2024. If taxpayers give $19,000 to each of their children in 2025, the annual exclusion will apply to each gift.

Federal income tax brackets show how much you owe on each part of your “taxable income,” which you calculate by subtracting the greater of the standard or itemized deductions from your adjusted gross income.

The standard deduction will also increase in 2025, rising to $30,000 for married couples filing jointly, up from $29,200 in 2024. Starting in 2025, single filers can claim $15,000, a bump from $14,600.

Trump’s tax cuts also included higher standard deductions, which will sunset after 2025 if Congress doesn’t extend that tax break. 

The IRS has unveiled higher capital gains tax brackets for 2025.

In its announcement Tuesday, the agency boosted the taxable income limits for the long-term capital gains brackets, which apply to assets owned for more than one year.  

The IRS also increased figures for dozens of other provisions, including federal income tax brackets, the estate and gift tax exemption and eligibility for the earned income tax credit, among others.

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The capital gains rate you pay is based on which bracket you fall into based on taxable income. 

You calculate taxable income by subtracting the greater of the standard or itemized deductions from your adjusted gross income. For 2025, the standard deduction will rise to $15,000 for single filers and $30,000 for married couples filing jointly.

Starting in 2025, single filers will qualify for the 0% long-term capital gains rate with taxable income of $48,350 or less and married couples filing jointly are eligible with $96,700 or less. 

Despite the talent shortage, vetting is important because “pretty much anyone can call themselves a tax preparer,” Young said.

The IRS receives more than 160 million federal tax returns every year and most come from paid preparers, according to the National Taxpayer Advocate’s 2024 Purple Book of legislative recommendations.

There are no federal licensing or competency requirements, and some paid preparers have no training or experience, the report noted. Under current law, the minimum requirement for paid professionals is an IRS-issued preparer tax identification number, or PTIN.

However, certified public accountants, enrolled agents and attorneys — professionals with unlimited representation rights before the IRS — generally pass competency tests and have continuing education requirements.

Free preparation options like Volunteer Income Tax Assistance, or VITA, and Tax Counseling for the Elderly, or TCE, also have competency standards.  

Unlike big box preparers, many tax professionals don’t accept walk-in traffic and operate mainly by referral, according to Tom O’Saben, an enrolled agent and director of tax content and government relations at the National Association of Tax Professionals.

“Talk to your friends and associates who have had a good experience with their [tax] professional,” he said. “Reach out to them now to see if they’re taking new clients.”

You should also weigh fee structure and availability outside the traditional tax season, which you may need if issues arise, Young said. “Cost is a big factor, but it shouldn’t be the only basis for your decision.”

The IRS keeps a database of credentialed preparers, including those who participate in the agency’s Annual Filing Season Program, which includes yearly refresher tests and continuing education.

You can check CPA and attorney licenses through state boards. Since the IRS oversees enrolled agents, you can email the agency to check licenses.

After a natural disaster, some victims may be eligible for tax relief — but qualifying can be tricky, tax experts say.

In late September, Hurricane Helene ravaged parts of Florida, Georgia, North Carolina, South Carolina, Virginia and Tennessee. Two weeks later, Hurricane Milton brought high winds, tornados and flooding through the middle of Florida.

Impacting both insured and uninsured homes, the losses from both storms could amount to tens of billions of dollars.

Certain victims can amend 2023 returns to claim a tax break for recent losses, known as the “casualty loss tax deduction,” according to the IRS. But the calculation is complicated, experts say.

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Here’s a breakdown of who qualifies for the casualty loss deduction and how the tax break works.

Before 2018, taxpayers who itemize tax breaks could claim the casualty loss deduction for more types of personal losses, such as home damage from a fire or storm, explained certified public accountant and attorney Mark Luscombe, principal federal tax analyst for Wolters Kluwer Tax & Accounting.

But the Tax Cuts and Jobs Act of 2017 temporarily restricted eligibility. Only losses in federally declared disaster areas will qualify through 2025, he explained.

The casualty loss deduction calculation starts with your home’s “adjusted basis,” or original purchase price plus the cost of certain improvements, explained Beth Brennan, vice chair for the disaster relief tax task force at the American Institute of Certified Public Accountants.

You also need to know how much the fair market value declined due to the disaster, she said.

“In practice, you don’t always have an appraisal of your property right before a disaster hits,” so taxpayers can use “safe harbor methods” outlined by the IRS, Brennan said. The IRS safe harbors generally don’t rely on appraisals.

Once you have your home’s pre-disaster fair market value, you compare it to your adjusted basis. You’ll choose the smaller of those two numbers before subtracting insurance proceeds and other relief payments.

The final step of the calculation is subtracting a $100 and 10% of your adjusted gross income, or AGI, which is all earnings minus certain tax breaks. 

“The higher your AGI, the greater the reduction of your loss,” said Luscombe.

In certain cases, “qualified disaster losses” are eligible for special rules, but “that’s driven by Congressional action,” according to Brennan.

When there’s a qualified disaster loss, the $100 rises to $500, there is no 10% AGI limit and victims can add their loss on top of the standard deduction.

That means they can claim the deduction even if they don’t itemize tax breaks, Brennan said. 

However, “we haven’t had any qualified disasters, as designated as such by Congress since late 2020,” Brennan said. 

“AICPA has been actively advocating for permanent uniform tax relief for all victims of disasters since 2021 — for almost four years now — because we have this inconsistent treatment,” she said. 

Many voters ages 50 and up say two issues — Social Security and Medicare — could decide how they cast their ballots this November.

The presidential candidate who wins on Nov. 5 — either former President Donald Trump or Vice President Kamala Harris — may be tasked with restoring solvency to those programs as they face looming trust fund depletion dates.

Republican vice presidential candidate JD Vance, in a Sept. 12 interview on CNBC’s “Squawk Box,” said that first addressing another issue, immigration, could help the programs’ funding woes.

Vance said Social Security and Medicare are facing a “massive fraud problem” because of undocumented immigrants who are collecting benefits, citing what he said were incidents of fraud related to him by some of his constituents and friends.

“Before we start talking about doing anything to the benefits for Americans who have earned them, let’s deal with the illegal alien fraud in our Social Security and Medicare system,” Vance said. “I think that costs us a lot of money.”

It’s not the first time the Trump-Vance campaign has suggested immigration is hurting the programs that millions of retirees rely on for monthly benefit checks and health-care coverage.

Trump in March said on social media platform Truth Social that Democrats are “killing Social Security and Medicare by allowing the invasion of the migrants.”

Meanwhile, Harris has talked about creating an “earned pathway to citizenship,” which may encourage immigrants to work and contribute to the programs. The Harris campaign did not provide CNBC more details on those plans.

The Social Security Administration assigns a unique Social Security number to each individual who is either a U.S. citizen, is lawfully admitted to the country as a permanent resident, is lawfully admitted on a temporary basis with Department of Homeland Security authorization to work, or has a valid non-work reason for needing a Social Security number, according to the agency.

A Social Security number is required for most jobs in the U.S., and employers are typically required to deduct payroll taxes from each employee to fund programs including Social Security and Medicare.

Over many years of work, the employee usually contributes a sufficient amount to be eligible to claim monthly Social Security checks and Medicare benefits when they retire or become disabled.

Documented immigrants — such as those with permanent status and dual intent temporary visas — pay the payroll taxes that contribute to Social Security and Medicare, according to Tara Watson, a senior fellow at The Brookings Institution and author of the book “The Border Within: The Economics of Immigration in an Age of Fear.”

Generally, undocumented immigrants are not eligible for Social Security or Medicare benefits, Watson said, but they may pay in to the programs anyway.

Some undocumented immigrants may use false Social Security numbers to work in jobs that require payroll tax contributions to Social Security and Medicare, and therefore they unofficially contribute to those programs, she said. Others, such as seasonal workers, may not pay payroll taxes.

Many long-term immigrants do receive benefits after contributing to the programs and earning eligibility, Watson said. Immigrants may eventually qualify for Social Security benefits if they are present in the U.S. lawfully and earn the required credits by working and contributing to the program, according to the American Academy of Actuaries.

Undocumented immigrants contributed $33.9 billion in federal social insurance taxes in 2022 toward Social Security, Medicare and unemployment insurance, according to the Institute on Taxation and Economic Policy.

Yet because of their immigration status, those workers are barred from accessing those benefits.

There are two common types of Social Security fraud involving immigration: When people who aren’t eligible for a Social Security number either steal one or create a false one so they can try to get a job in the U.S., and when people who aren’t eligible for Social Security or Medicare benefits use a fraudulent name or Social Security number to claim benefit payments.

Committing these kinds of fraud isn’t easy. 

But it is possible for some people, including some undocumented immigrants, to carry it out.

Stealing benefits can be difficult, since it requires tapping into someone’s Social Security account and changing their bank account information to access the money, according to Andrew Biggs, a senior fellow at the American Enterprise Institute and former principal deputy commissioner at the Social Security Administration.

After the Social Security Administration started allowing individuals to change their bank deposit information through their online accounts, the agency and the Office of Inspector General began receiving complaints of unauthorized changes, Jeffrey Brown, deputy assistant inspector general at the Social Security Administration Office of the Inspector General, told the House Ways and Means Committee in 2023.

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Audits found $33.5 million in benefits for 20,878 beneficiaries was redirected through unauthorized direct deposit changes between January 2013 and May 2018, according to Brown. However, another $23.9 million for 19,662 beneficiaries was prevented from misdirection by the agency before payments were made.

The investigation, from a 2019 report, did not implicate undocumented immigrants in that activity.

“Our audits found fraudsters may steal identities to work or to claim earnings-related benefits,” Brown said in his written testimony, which did not give demographic information on those committing the fraud.

There have been cases of undocumented immigrants found to be misusing Social Security numbers to fraudulently access benefits.

“There are certainly some immigrants who are getting benefits when they shouldn’t be, but I think it’s a relatively small group of them,” Watson said.

“This is not a problem that I’ve heard specifically that, as [Vance] says, is widespread,” Biggs said, referring to Vance’s comments about social services fraud by undocumented immigrants.

The type of fraud in which Social Security numbers can be misused for work purposes may be more common, experts say.

When someone is working using a Social Security number that isn’t theirs, their earnings may be credited to the person whose name matches that number in the agency’s records.

Alternatively, they may be credited to the Social Security Administration’s earnings suspense file.

The earnings suspense file is an electronic holding file for wage items where names and Social Security numbers on Form W-2s do not match the Social Security Administration’s records, an agency spokesperson said via email.

The wage records stay in that file until they can be verified and matched to a worker’s record. Despite the wage records’ unidentified status, the program’s trust funds have received revenues for the wage items placed in the suspense file, the spokesperson said.

A 2023 report from the Social Security Administration Office of the Inspector General showed the earnings suspense file had accumulated $2.15 trillion in wages for tax years 1937 through 2022.

The earnings suspense file includes undocumented immigrants, among other people, Watson said.

She said the existence of the earnings suspense file “gives you an indication that people are putting into the system and not claiming from the system.”

Immigration overall is a net positive to Social Security and Medicare, experts say.

Both programs rely on funding from payroll taxes. The experts say that more immigrants means more workers who contribute to both Social Security and Medicare through their paychecks.

“Immigration, in general, has a very positive role,” said Sam Gutterman, chairperson of the American Academy of Actuaries’ Social Security committee.

Neither the Social Security Administration nor the Department of Health and Human Services, which oversees Medicare, provided recent data on the effect of undocumented immigrants on their programs.

When asked about Vance’s statement that undocumented workers are draining Medicare and Social Security, HHS spokesperson Renata Miller said: “These claims are false and they serve as a distraction from the health care concerns that everyday Americans care about. HHS will continue working to lower health care costs so that patients can fill a prescription without rationing pills or going into medical debt.”

The Social Security Administration in an email explained that there are strict rules about who can legally receive benefits and Social Security numbers.

“The Social Security Act does not permit payment of benefits to noncitizens residing in the U.S. if they’re not lawfully present here,” a Social Security spokesperson said. “In order to get a Social Security number for work, by law you need to be a U.S. citizen or have [Department of Homeland Security] authorization. SSA has stringent evidentiary requirements to confirm the authenticity of documents and prevent issuance of numbers to ineligible individuals.”

In a 2013 report, the Social Security Administration said it is difficult to precisely identify the total amount of taxes paid and benefits that may have been received by unauthorized workers.

In that report, the office of the program’s chief actuary said undocumented immigrants paid as much as $13 billion in payroll taxes to the program’s trust funds in 2010, while about $1 billion in benefit payments were attributed to unauthorized work. That resulted in a contribution of roughly $12 billion to the program’s cash flow that year, according to the agency.

“We estimate that earnings by unauthorized immigrants result in a net positive effect on Social Security financial status generally,” the office of SSA’s chief actuary said.

“We estimate that future years will experience a continuation of this positive impact on the trust funds,” it wrote.

More recently, the Social Security Administration has said immigration tends to be beneficial for the program because those new entrants to the country tend to be working age.

“When they come to the country, they tend to come here for economic opportunity and enter the labor force, and that’s very much a positive,” Stephen Goss, chief actuary of the Social Security Administration, said in testimony before the House Budget Committee in June.

“That actually helps us with having more revenue coming in,” Goss said.

Those workers may eventually work the length of time necessary to qualify for benefits, Goss said.

However, some immigrants pay into the program and never collect benefits, he explained.

And if they have children, that helps to make up for the country’s low birth rate, which also benefits the program, Goss added.

In a new report, the American Academy of Actuaries found immigration may “significantly enhance the future financial condition of Social Security, especially in the long term.” The report says immigration may help improve the worker-to-beneficiary ratio and slightly delay the depletion of the program’s trust funds.

However, immigration is “not a silver bullet to ‘solve’ 100% of Social Security’s financial problems,” according to the research, which analyzed the Social Security Administration’s latest annual trustees report.

Both Social Security and Medicare face pressures as the large baby boomer generation retires and taps the programs for benefits.

Absent action from Congress, the trust fund Social Security relies on to pay for retirement benefits is due to run out in 2033, when 79% of benefits will be payable, according to projections from the program’s trustees.

Medicare’s hospital insurance trust fund, also known as Part A, is projected to last until 2036, when 89% of benefits will be payable.

Biggs said the presidential campaigns should focus on policies to address those looming depletion dates that will prompt across-the-board benefit cuts, rather than fraud by undocumented immigrants, which is a much smaller issue for the programs.

Focusing on the undocumented immigrant angle first is a “total sideshow” when it comes to the larger Social Security and Medicare funding issues, Biggs said.

“I think he [Vance] is using it as a deflection because they don’t want to talk about fixing Social Security,” Biggs said.

Federal spending on children climbed to a peak of $11,690 per child in 2021 in response to the Covid-19 pandemic.

Since then, there has been a “steep decline” in those expenditures, which fell to $10,190 per child in 2022 and then to $8,990 per child in 2023, adjusted for inflation, according to new research from the Urban Institute, a Washington, D.C., think tank focused on economic and social policy research.

In 2024, that spending is expected to level off to $8,760 per child — a decline of about $230 per child from the previous year, the research found.

Covid relief — through federal legislation as well as state-level initiatives — helped provide “unprecedented” new funding in 2020 and 2021 that significantly improved conditions for children and their families, according to the report. Those efforts included tax provisions, social services, training and housing programs.

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Those pandemic-era changes — which were largely temporary — had a “big and immediate” effect on poverty, according to Heather Hahn, associate vice president at the Urban Institute and a co-author of the report.

“For children, we saw poverty just plummet because they had more money,” Hahn said.

In 2021, child poverty fell to 5.2%, down from 12.6% in 2019. The expiration of the aid drove child poverty back up to 12.4% in 2022.

Tax expenditures represent the largest drop in federal spending on children between 2022 and 2023, while there were also sharp declines in spending on nutrition and more modest changes in education funding, according to the Urban Institute.

Pandemic-era tax expansions were the largest in 2021 and included direct payments to families.

Three rounds of stimulus check payments deployed by the federal government between March 2020 and March 2021 included larger maximum payments for families with children.

The first stimulus payments provided an additional $500 per dependent under age 17. The second round of payments provided $600 per dependent under 17. And the third, most generous payments provided $1,400 per dependent, this time including those ages 17 and 18. To qualify, certain income thresholds and other restrictions applied.

Federal lawmakers also temporarily put in place a more generous child tax credit for 2021 with maximums of $3,000 per child and $3,600 per child under age six — up from $2,000 per child.

The child tax credit was also made non-refundable, allowing families with little to no income to still access the full sums. As with the stimulus checks, families needed to meet income and other requirements to qualify.

By 2023, the stimulus check money had largely been paid out and the child tax credit expenditures had fallen back below pre-pandemic levels, according to the Urban Institute.

Families may receive even less money when the Tax Cuts and Jobs Act expires in 2025, barring action by Congress before then. At that point, the current child tax credit of up to $2,000 per child under age 17 is poised to fall to $1,000 per child under age 17.

Lawmakers may again consider making the child tax credit more generous.

“The long-term future of the child tax credit and this broader support for families and children is going to be a pretty central part of the discussion next year,” Garrett Watson, senior policy analyst at the Tax Foundation said of the upcoming federal tax policy deadline Congress faces.

Along with the expanded child tax credit, lawmakers are also poised to look at other changes to the tax code that are set to expire, particularly the expanded standard deduction and repeal of the personal exemption. Taken together, those three changes net out to be revenue neutral, and therefore are interrelated, Watson said.

“Generally speaking, there is a bipartisan interest in at least maintaining current policy, meaning the child tax credit that was established and expanded in 2017,” Watson said.

However, there is no consensus on what changes should be included to that credit in the future, he said.

As part of her presidential campaign, Vice President Kamala Harris has suggested restoring the expanded child tax credit of up to $3,600 and providing $6,000 for families with newborn children. Meanwhile, Republican vice-presidential candidate JD Vance has said he wants to raise the child tax credit to $5,000.

Generally, federal spending on children will have to compete with other priorities.

The Urban Institute projects that by 2034 all categories of federal expenditures on children as a share of gross domestic product will decline below current levels. That’s as other areas, like interest payments on the national debt and outlays to Social Security, Medicare and Medicaid, are expected to take up a larger share of federal spending by that year.

Traditionally, states and localities have provided the most spending for children, primarily through education, Hahn said. The federal government temporarily had a larger role in spending on children during the pandemic, she said.