Tax Credit Changes in 2026: New Social Security Number Rules for Child and Earned Income Credits

The "Safeguarding American Workers Benefits Act" changes the rules for who can claim the Child Tax Credit (CTC) and the Earned Income Tax Credit (EITC), starting in the 2026 tax year. The core change? Stricter Social Security number (SSN) requirements.

SSN Requirements: No Work Authorization, No Credit?

This bill, straight up, says that to claim the CTC or EITC, the SSNs provided (for you, and any qualifying child for the CTC) must be issued to either a U.S. citizen or someone authorized to work in the United States. This is a significant departure from prior rules, potentially impacting many families.

• Child Tax Credit: Section 2(a) of the bill specifically requires that both the taxpayer's and the qualifying child's SSN be valid for employment in the U.S. and issued before the due date of the tax return. This means that if your child's SSN, or your own, doesn't meet this requirement, you won't be able to claim the credit.
  • Real-World Example: Imagine a family where the parents are authorized to work in the U.S., but their child, for whatever reason, has an SSN that isn't specifically designated for employment. Under this new law, they'd be out of luck for the CTC, even if they previously qualified.
• Earned Income Tax Credit: Section 2(b) applies the same logic to the EITC. Your SSN must be valid for employment in the U.S. to claim this credit. If you've been relying on an SSN that isn't work-authorized, you'll need to address that before the 2026 tax year to maintain eligibility.
  • Real-World Example: Consider a single parent working two part-time jobs to make ends meet. If their SSN isn't explicitly authorized for employment, they could lose access to the EITC, a crucial support for low-to-moderate-income workers.

Potential Roadblocks and Real-World Impact

While the bill's stated aim is to prevent fraud, the practical effect could be to exclude many eligible families, particularly those with mixed immigration statuses or those who have had difficulty navigating the complexities of the Social Security Administration. The requirement that an SSN be specifically authorized for employment adds a layer of complexity and potential for denial, even for those legally residing and working in the U.S.

It's important to note that the definition of "authorized to work in the U.S." isn't explicitly laid out in this bill, leaving room for potentially narrow (and problematic) interpretations by the IRS.

This bill essentially creates a stricter gatekeeping mechanism for accessing these important tax credits. While reducing improper payments is a valid goal, the concern here is that the burden will fall disproportionately on vulnerable families who may already face challenges in accessing government services. The bill could potentially be used to deny credits to eligible families due to minor administrative errors or documentation issues. The added complexity could also deter some eligible families from even applying.