The IRS has set the maximum child tax credit for tax year 2027 at $2,300 per child, up $100 from 2026, with $1,800 of it refundable. The same Nov. 5 announcement, IR-2026-133, puts the largest earned income tax credit at $8,496 for a worker with three or more qualifying children, up from $8,231. The amounts generally apply to returns filed in 2028.
For a household with children, the question is how far each credit moves and where its own earnings fall against the lines that shrink the earned income credit. A family with three qualifying children would see the child credit alone rise from $6,600 to $6,900 on a 2027 return, and the earned income credit step is bigger for larger families. Neither amount is a payment that arrives this year.
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How much more does the child tax credit pay?
The maximum is $2,300 for each qualifying child, according to Revenue Procedure 2026-35, the technical guidance that accompanies the release. For 2026 returns, filed next spring, the figure is $2,200, Revenue Procedure 2025-32 shows. The refundable portion climbs by the same $100, from $1,700 to $1,800.
The refundable portion matters most to households whose income tax bill is small or zero. It is the slice of the credit that can come back as a refund even when no tax is owed. How much of it a family can actually claim depends on earnings rules set in law, which an inflation adjustment does not touch.
The totals build with family size. Across two qualifying children the maximum child credit is $4,600, up from $4,400, and across three it is $6,900, up from $6,600. The refundable portions add up to as much as $3,600 for two children and $5,400 for three, up from $3,400 and $5,100.
IRS Chief Executive Officer Frank J. Bisignano said in the announcement that taxpayers “will continue to benefit from the Working Families Tax Cuts (WFTC)” and “will see WFTC credits and deductions increase with this adjustment.” He pointed to the child tax credit among the increases families will see next tax year.
What changes in the earned income credit for each family size?
The announcement names only the top amount, $8,496 for three or more children. The table in the revenue procedure covers all four family sizes, and every maximum rises from the 2026 level the IRS set last October:
- No qualifying children: $685, up from $664
- One child: $4,573, up from $4,427
- Two children: $7,552, up from $7,316
- Three or more children: $8,496, up from $8,231
In dollars, the biggest step goes to the largest families: $265 for three or more children, $236 for two, $146 for one and $21 for workers without children. In percentage terms the four maximums each work out to about 3.2 percent higher, so the gap in dollars simply follows the size of the credit.
Each maximum is reached at a set level of earned income. For 2027 that point is $18,880 for families with two or more children, up from $18,290. It is $13,450 for one child, up from $13,020, and $8,960 with no children, up from $8,680.
Where does the earned income credit start to shrink and stop?
Once income passes a threshold, the credit shrinks until it reaches zero. For 2027 the shrinking starts at $32,170 for joint filers with children, up from $31,160, and at $24,660 for all other filers with children, up from $23,890. Workers without children begin losing credit at $18,730 on a joint return and $11,210 on any other, against $18,140 and $10,860 for 2026.
The credit then shrinks at a steady rate. Going by the thresholds and cutoffs in the table, the loss works out to about 21 cents of credit for each dollar of income above the starting line for families with two or more children, about 16 cents with one child and about 8 cents with none.
The credit disappears completely for three or more children at $72,512 for married couples filing jointly and $65,002 for other filers, compared with $70,244 and $62,974 in 2026. Take a parent with three children filing as head of household whose earned income and adjusted gross income are both $64,000. Under the 2026 figures that parent is past the cutoff and gets nothing, and under the 2027 figures the same income still earns a small credit.
A separate cap applies to investment income. A household with more than $12,600 of it for 2027 cannot claim the earned income credit at all, up from $12,200 for 2026, the revenue procedures show.
Which other family amounts moved in the same announcement?
The adoption credit reaches a maximum of $18,250 for 2027, up from $17,670, and up to $5,280 of it is refundable, against $5,120 for 2026. Under the revenue procedure, the credit starts to phase out above $273,680 of modified adjusted gross income and is gone at $313,680.
The announcement also raises the limit on salary a worker can divert into a health flexible spending account to $3,500, up $100, and the amount that can carry over to the next year to $700, up $20. Those are separate from the two credits, but they sit in the same table of 2027 limits that families will use when they plan a year ahead.
When do the 2027 amounts reach a tax return?
They are for the 2027 tax year, which means income earned next year and, in the IRS’s words, returns filed in 2028. Nothing changes on the return families file this coming spring. The IRS said of the 2026 figures that they “generally apply to tax returns filed in 2027.”
Who qualifies for either credit is decided by tax law and not by this announcement, which sets dollar amounts and income limits. Families can compare their own numbers against the full tables in the two revenue procedures. The announcement also covers almost 70 tax provisions in all, from the rate schedules to business expensing limits.
Planning around the 2027 child and earned income credits?
Credit amounts like these shape how a household budgets a refund, and they sit beside income lines that can shrink or erase them, such as the $65,002 earned income cutoff for a single parent with three children. Those same lines exist at the other end of working life, where the tax bill is set by retirement income instead.
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This article was produced with AI assistance and edited for accuracy against the sources linked above.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
