The Family First Act (H.R.353) restructures major portions of the individual tax code that apply to families. It permanently enlarges the child tax credit, moves that credit into the refundable-credit provisions of the Code, and creates a new refundable credit for pregnant mothers whose pregnancy has reached 20 weeks gestation.
The bill also revises the Earned Income Tax Credit for filers with children, eliminates the additional personal exemption for dependents, removes the head‑of‑household filing status, narrows the dependent-care credit, and extends the limitation on state and local tax (SALT) deductions.
These are not just rate tweaks. The package changes eligibility rules, verification requirements, and where in the Code family benefits live — producing immediate compliance and systems work for the IRS and tax professionals while reshaping who gains and who loses at different income levels, family sizes, and immigration statuses.
The bill therefore matters to payroll and tax operations, software vendors, physicians (because of pregnancy certifications), and policymakers tracking distributional effects on single‑parent and low‑income households.
At a Glance
What It Does
Raises per‑child credit amounts and makes the child tax credit a refundable benefit in the refund-credit subpart; creates a separate refundable $2,800 pregnancy credit tied to a physician certification at 20 weeks; simplifies numeric parameters of the EITC for filers with children; eliminates the additional personal exemption and the head‑of‑household filing status; narrows the dependent‑care credit; and continues the SALT cap past 2025.
Who It Affects
Households with children (especially families with multiple young children), pregnant mothers seeking the new credit, tax preparers and software vendors, the IRS (for verification and payment systems), physicians who must supply gestational certifications, and taxpayers in high‑SALT states who rely on the SALT deduction.
Why It Matters
The bill redistributes tax relief across family types rather than uniformly increasing benefits: it increases per‑child nominal amounts but introduces new phase‑in and verification rules that alter outcomes for very low‑income filers and immigrant households. It also imposes new compliance tasks (medical certifications, SSN checks) that have operational and legal implications.
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What This Bill Actually Does
The bill permanently enlarges the child tax credit and relocates it to the section of the Code that houses refundable credits. It sets two base dollar amounts by age: a larger amount for children who are under six at year end and a slightly smaller amount for older children up to age 17, and caps the number of children eligible for the credit at six per taxpayer.
The credit’s design combines a full nominal benefit for most taxpayers with two separate income‑step provisions: an unusual phase‑in tied to very low modified adjusted gross income (MAGI) and a conventional phase‑out above high income thresholds. The bill also requires SSNs issued under strict Social Security rules for taxpayers and children to claim the credit.
The new pregnancy credit is a distinct refundable credit equal to a percentage of $2,800 for each qualifying unborn child once the pregnancy reaches 20 weeks, subject to income phase‑in and the same high‑income phase‑out thresholds used for the child tax credit. To claim the pregnancy credit the mother must obtain a physician certification of gestational age and sign under penalty of perjury; physicians may provide a standardized form and the statute bars using the certification for other purposes.
The credit explicitly excludes unborn children that died as the result of an induced abortion (with carve‑outs for life‑saving treatment and ectopic pregnancies) and allows the credit for multiple pregnancies in the same year.Separately, the bill revises the Earned Income Tax Credit for taxpayers with children by changing credit percentages, caps, and the earnings ranges used to calculate the credit; the statute replaces several EITC tiers with a simplified structure and new maximum amounts. The legislation removes the additional personal exemption for dependents and eliminates the head‑of‑household filing status from the Code, with numerous conforming changes across tax provisions.
It also narrows the dependent‑care (child care) credit by excluding dependent children under the previous under‑13 rule and tightening the rules for care provided outside the household. Finally, the SALT limitation that was set to lapse is extended so the cap continues after 2025.All of the tax‑code changes become effective for taxable years beginning after December 31, 2025.
Because the bill rearranges where credits reside in the Code and adds new verification and medical certification mechanics, implementation will require IRS guidance, updates to tax forms and software, and new operational protocols for verifying SSNs and accepting physician attestations.
The Five Things You Need to Know
Child tax credit: establishes two base amounts — $4,200 per child under age 6 and $3,000 per qualifying child age 6–17 — and limits creditable children to six per taxpayer.
Refundability and phase mechanics: moves the child credit into the refundable‑credit subpart but ties the credit to an applicable percentage that is 100% at MAGI ≥ $20,000 and pro rata below that (applicable percentage = MAGI / $20,000), while separately phasing out $50 per $1,000 above $400,000 (joint) or $200,000 (other).
Pregnancy credit: creates section 36D — a refundable credit equal to the applicable percentage of $2,800 per qualifying unborn child once a physician certifies gestational age of at least 20 weeks; mothers must provide a physician’s form and a sworn statement.
Filing‑status and deductions: eliminates the head‑of‑household filing status and sets the personal exemption amount to zero for tax years after 2025, with wide‑ranging conforming amendments throughout the Code.
Dependent‑care and SALT: excludes dependent children (previously under‑13 rule) from the dependent‑care credit for most situations, and extends the SALT deduction limitation beyond 2025 rather than allowing it to expire.
Section-by-Section Breakdown
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Permanent expansion and rewrite of the Child Tax Credit
This section replaces the existing section for the child tax credit with new language setting two age‑based base amounts and a cap of six eligible children. It defines qualifying children as under 18 at calendar‑year end and reinstates strict social‑security‑number requirements tied to SSA issuance rules. Practically, this means larger per‑child nominal benefits but stronger identity/eligibility checks and a numerical cap that can affect very large families.
Refundability, phase‑in and income phase‑out mechanics
The bill moves the child credit into the refundable‑credit subpart (relabeling it section 36C) so it’s treated as a refundable amount for payment purposes. At the same time it introduces two income mechanisms: an uncommon phase‑in/percentage rule that makes the credit a fraction of its base for taxpayers with MAGI below $20,000 (applicable percentage = MAGI / $20,000), and a separate high‑income phase‑out that reduces the credit by $50 per $1,000 of MAGI beyond $400,000 (joint) or $200,000 (other). The combination creates non‑linear outcomes across the income distribution and increases compliance demands because refundability is now explicitly located among refundable credits.
New refundable Credit for Pregnant Mothers (section 36D)
This newly inserted section creates a refundable credit equal to a percentage of $2,800 for each qualifying unborn child once a physician certifies a gestational age of 20 weeks or greater. The statute prescribes the physician’s reasonable‑medical‑judgment standard, a physician form, and a sworn statement by the mother; it forbids using the certification for other purposes. The credit disallows claims when an unborn child died as a result of an induced abortion (except for life‑saving or ectopic treatments) and provides for multiple pregnancies in the same year.
Earned Income Tax Credit simplification for filers with children
The bill restructures section 32 by consolidating EITC tiers and increasing the credit percentage for filers with children to 25 percent in the revised table, raising the earned‑income thresholds and adjusting maximum credit amounts for joint and non‑joint filers. The statutory text replaces multi‑tiered phase‑in/phase‑out rows with a simpler numeric grid, changing how earned income and phaseout amounts are calculated and indexed for inflation starting 2026.
Personal exemptions eliminated and head‑of‑household removed
The bill sets the exemption amount to zero for taxable years after 2025 and expunges the head‑of‑household filing status from section 1 and many related cross‑references across the Code. Numerous conforming amendments recalibrate thresholds and statutory language (standard deduction references, filing‑status tests, and various credit and deduction rules) to remove reliance on the HoH classification.
Dependent‑care credit narrowed; SALT cap extended
Section 21 is amended so that the dependent‑care credit no longer uses the previous under‑13 rule — instead it is confined to qualifying individuals who have attained age 18 and are physically or mentally incapable, and care outside the household is limited by a requirement that the qualifying individual spend at least eight hours a day in the taxpayer’s household. Separately, the SALT limitation that was scheduled to lapse is extended so the limitation continues to apply to tax years after 2025.
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Explore Finance in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Parents of children under six — the bill raises the per‑child base amount for the youngest cohort, so families with children under six receive a larger nominal credit per child than under current law.
- Larger (but not unlimited) families — by allowing up to six children per taxpayer the bill explicitly preserves support for multi‑child households that previously could face practical limits under older credit designs.
- Tax‑software vendors and tax preparers — the substantial rewrites, new sections and form changes create demand for software updates, new screening/verification logic, and paid preparer work to help clients claim expanded credits.
- Homeowners in high‑tax states — by extending the SALT cap the bill preserves the status quo for taxpayers who rely on SALT deductions rather than removing that limitation.
- Taxpayers claiming the pregnancy credit — eligible mothers with certified pregnancies at or beyond 20 weeks can claim a refundable amount that did not previously exist.
Who Bears the Cost
- Very low‑income households with MAGI below $20,000 — the child credit is pro‑rated by MAGI below $20,000, so the poorest filers receive a reduced applicable percentage rather than the full nominal amount.
- Single parents who lose the head‑of‑household filing status — removing HoH will, for many households, raise taxable income or increase tax liability unless other code changes compensate, shifting burden to single custodial parents.
- Physicians and clinical providers — doctors and midwives must provide gestational‑age certifications and a form, exposing them to new administrative tasks and potential legal risk tied to the attestation language.
- IRS and tax administrators — moving credits, adding medical‑certification intake and stricter SSN rules will require programming, guidance, and enforcement resources, imposing upfront administrative costs.
- Working parents who rely on the child‑care credit for under‑13 dependents — narrowing that credit removes or reduces a tax subsidy for child care that currently supports workforce participation.
Key Issues
The Core Tension
The central dilemma is whether to expand family support by raising per‑child credits while simultaneously imposing stricter income and identity verification and a medical attestation for unborn children: the bill increases nominal benefits for many families but reduces or complicates access for the poorest filers, mixed‑status households, single parents (through removal of HoH), and introduces medical‑administrative obligations that transfer compliance burdens to physicians and tax administrators.
The bill combines an expansion of nominal credit amounts with eligibility and verification rules that can blunt distributional effects. Making the child credit formally refundable and increasing per‑child amounts looks outwardly generous, but the requirement that applicable percentage scale up with MAGI below $20,000 means the poorest filers can receive a reduced share of the new amounts.
That structure is unusual: most refundable credits phase in with earnings or are flat for low incomes; here a pure MAGI fraction reduces benefit for filers at the very bottom and will complicate interactions with existing safety‑net programs and refundable credits such as the EITC.
The pregnancy credit raises legal and administrative questions. Tying a refundable tax benefit to a physician’s certification at 20 weeks injects health‑care providers into tax administration.
The statutory form and perjury statements create potential liability concerns and privacy issues; the statute attempts to limit secondary uses of the form, but state‑law reporting, medical‑record retention, and third‑party discovery could create tensions. The explicit bar on claims where an unborn child died as a result of an induced abortion (with medical exceptions) produces compliance edge cases (e.g., miscarriages treated clinically) that will require detailed IRS guidance and will likely attract litigation and political scrutiny.
Removing head‑of‑household and the personal exemption simplifies one dimension of the code but can raise taxes for single parents who benefited from the HoH rate structure. Because the bill does not pair that removal with a replacement mechanism targeted at single custodial parents, affected households may see net tax increases despite higher child‑credit nominal amounts.
Implementation across thousands of cross‑references in the Code — the bill already contains dozens of conforming edits — will also surface secondary winners and losers at the margins unless careful transitional rules and IRS guidance are issued.
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