Monique Stanton

Much has been said about the federal megabill that passed back in July — analysis shows the bill will have a catastrophic impact on families with low incomes and people living in rural areas, particularly when it comes to health coverage and food assistance.

But one section of the bill that hasn’t been mentioned much, and that is an area of deep concern, is the federal Child Tax Credit.

While the so-called “One Big, Beautiful Bill Act” (OBBBA) includes modest improvements to the Child Tax Credit, including a $200 increase to the maximum credit per qualifying child and permanent provisions that will keep the value of the credit up to pace with inflation starting in 2026, the new law also leaves out millions of kids who need the credit the most. It does this in a couple of different ways.

First, the OBBBA strips away the Child Tax Credit entirely from children who don’t have at least one parent or guardian with a Social Security Number. This means that roughly 2.6 million U.S. citizen children living in immigrant families, including 22,300 children here in Michigan, will no longer be able to receive this critical funding even if their parents pay their taxes with Individual Taxpayer Identification Numbers (ITINs). With 300,000 Michigan children being raised by immigrant parents or guardians, including 70,000 high school students representing 15% of the state’s high school population, Michigan’s economic future depends greatly on the financial stability of these families.

This change in eligibility for ITIN filers is yet another direct attack on immigrant families who have already faced significant trauma as a result of the Trump administration’s mass deportation and detention policies, which have tragically separated children from their parents and deported individuals with a complete lack of due process.

The second thing that this bill does is maintain the credit’s problematic refundability structure and earnings requirement, which have kept children growing up in households with low incomes from receiving the full credit because their parents earn too little. These are families that are already struggling to make ends meet and, yet, they are not receiving the full credit that more affluent families receive. According to Columbia University’s Center on Poverty and Social Policy, more than 1 in 4 children in the U.S. are estimated to be ineligible for the full Child Tax Credit under the OBBBA because their family income is not high enough. This represents 19 million children in our country, 2 million of which are newly ineligible for the full credit because the OBBBA excludes a growing number of families with moderate income levels.

As a direct result of our country’s past and present-day systemic racism and oppression, a number of children will be disproportionately ineligible for the full credit under the OBBBA according to Columbia University, including American Indian or Alaska Native, Black, and Latino children. Children with a female single parent, children under the age of 6 and children in rural areas will also be disproportionately left out of the full credit. In Michigan’s 1st Congressional District, which encompasses the Upper Peninsula and all of our state’s northern counties, an estimated 39,000 children — 31% of children under the age of 17 — will be ineligible for the full $2,200 Child Tax Credit because their families’ incomes are too low. This includes children growing up in the counties of Alpena, Alcona, Montmorency and Presque Isle.

The federal Child Tax Credit is one of the most important tools we have in reducing childhood poverty, strengthening the economic security of families and helping children to grow up healthy and strong. But it’s ineffective at best if it shuts out the very children who need it the most. While there have long been issues with the structure of the federal Child Tax Credit and whom it reaches, the OBBBA further exacerbates access to this critical poverty-fighting tool at a time when other vitally important social safety net programs are also being slashed.

There is a clear theme in what the OBBBA is designed to do: cater to the ultra wealthy and most affluent families among us, while leaving behind families with low incomes as well as immigrant families. If we want all children in our country, state and local communities to thrive, we need to continue to fight for each and every one of them to reach their full potential. That is what we plan to continue to do here at the Michigan League for Public Policy, alongside our many partners across the state, and we hope you will join us in the fight. A great way to learn more about child well-being in Michigan and how you can make a difference in the lives of our state’s kids is by joining us at our third annual Champions for Kids luncheon, taking place on Sept. 16 in Lansing. You can learn more about the event and register at https://mlpp.org/champions-for-kids/.