The All-Americans Tax Relief Act of 2025 significantly expands tax credits and deductions for working families and introduces new tax burdens on higher earners and debt holders. The bill increases the Earned Income Tax Credit (up to 45% for families with three or more children) and makes the Child Tax Credit fully refundable at $2,000 per child for up to three children, plus $500 for additional children. It also creates six new deductions available to most taxpayers for medical expenses, childcare costs, public transit commuting, tutoring services, credit card interest, and rent payments, while eliminating income thresholds for excluding discharged debt from taxation. To offset these provisions, the bill raises the top long-term capital gains tax rate from 20 percent to 25 percent and prioritizes individual debt exclusions in the tax code. Most provisions take effect for tax years beginning after December 31, 2026.
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