The new Trump tax plan could significantly reshape how families are taxed, especially with the Tax Cuts and Jobs Act (TCJA) set to expire at the end of 2025. On May 22, 2025, House Republicans passed a major Trump-backed bill, officially titled the “One Big Beautiful Bill Act,” by a vote of 215-214. While the bill does not include a specific proposal for stay-at-home moms or unpaid caregivers, it does expand specific credits and deductions that could benefit stay-at-home parents or caregivers as a whole.
A financial advisor can help you understand how these proposed changes may affect your household.
Trump Tax Plan: Tax Credits That May Benefit Stay-at-Home Moms
While the 2025 tax legislation does not introduce a tax credit specifically for stay-at-home moms, it includes several provisions that may provide financial relief to families with a single income or a parent staying at home to care for children. The following tax credits could be relevant depending on a family’s income level, tax filing status and employment situation.
Expanded Child Tax Credit
One of the most notable changes in the proposed legislation is the expansion of the Child Tax Credit. The bill increases the credit to $2,500 per qualifying child for tax years 2025 through 2028. After 2028, the credit reverts to $2,000.
To claim this credit, the taxpayer must provide valid Social Security numbers for themselves, their spouse (if applicable) and each qualifying child.
This credit begins to phase out at higher income levels, but many families with stay-at-home parents and modest household incomes will likely remain eligible. Because the credit is partially refundable, families with limited income tax liability may still receive some benefit in the form of a tax refund.
How This Compares to Current Law:
Under current tax law, the Child Tax Credit is worth $2,000 per child, with only $1,700 of that amount refundable. The 2025 proposal increases the total credit amount and may offer greater relief to families with little or no taxable income, a group that often includes single-income households with stay-at-home parents.
Employer-Provided Child Care Credit: Enhancement
The bill also significantly enhances the Employer-Provided Child Care Credit. Under the proposal, employers can claim a credit of up to 50% of qualified child care facility expenses, up from the previous 25%. The annual cap on eligible expenses also increases to $600,000.
Though this credit is claimed by employers, it could indirectly benefit stay-at-home moms in two key ways:
- It encourage employers to offer more child care assistance, which may support flexible work arrangements.
- It may reduce costs for working spouses who rely on employer-sponsored child care.
How This Compares to Current Law:
Previously, employers could claim a 25% credit on qualified child care expenses and a 10% credit on child care resource and referral services, with a maximum annual credit of $150,000. The new legislation doubles the credit percentage and quadruples the eligible cap, creating more incentive for employers to invest in child care infrastructure that could support working and returning parents
Paid Family and Medical Leave Credit: Extension and Enhancement
This bill continues and expands the employer tax credit for providing paid family and medical leave. Employers can claim a credit for either:
- Wages paid during qualifying leave, or
- Insurance premiums paid for leave coverage.
Importantly, the new legislation allows employers to qualify for the credit even if no employee takes leave, so long as a compliant policy is in place. This approach encourages employers to proactively offer paid leave benefits regardless of usage rates, promoting a more family-friendly work environment.
For stay-at-home moms, this may not result in a direct tax benefit. However, it could open up more part-time, flexible or temporary work options that come with the security of leave benefits.
How This Compares to Current Law:
The current paid family and medical leave credit, introduced through earlier tax reforms, is temporary and applies only if an employee actually uses leave. The new legislation not only extends the credit beyond its original expiration but broadens eligibility criteria. This makes it more accessible and more likely to affect hiring and benefit policies that impact working families.
Want to know how else the Trump Tax Plan may affect you? Read more here.
New Trump Tax Bill vs. Campaign Promises
The 2025 tax proposal currently under consideration includes several provisions aimed at families, such as an expanded Child Tax Credit and enhanced employer incentives for child care and paid leave. However, it lacks a specific tax credit or deduction for stay-at-home parents or unpaid family caregivers. Both of these were previously floated during Donald Trump’s presidential campaigns.
In 2016, then-candidate Trump signaled interest in extending a child care tax deduction to stay-at-home mothers. The campaign considered whether to allow mothers who care for their own kids to receive the same tax benefit as those who hire nannies or take children to daycare. One possible way of doing that was to assign a dollar value to at-home care provided by a parent. However, this proposal was never formalized.
More recently, in October 2024, Trump proposed a new tax credit for unpaid family caregivers. Speaking at a campaign event in New York, he said: “I will support a tax credit for family caregivers who take care of a parent or a loved one.” No specific policy details or eligibility criteria were released at the time.
The 2025 tax bill does not contain a provision resembling this caregiver credit. Instead, it focuses on expanding general family tax relief through mechanisms like the Child Tax Credit and employer-based incentives.
Campaign Promises vs. 2025 Tax Proposal
| Topic | Campaign Promise | Included in 2025 Tax Proposal? | Notes |
| Child Care Deduction for Stay-at-Home Moms | 2016: Consider allowing stay-at-home moms to deduct child care equivalent costs. | Not included | No provision for valuing unpaid caregiving work for tax purposes. |
| Family Caregiver Tax Credit | 2024: Trump said he would support a tax credit for those who care for a parent or loved one. | Not included | No specific caregiver credit in the current bill. |
| Expanded Child Tax Credit | Not tied to a specific campaign promise, but consistent with broader family support themes. | Included | Credit increased to $2,500 per child (2025–2028); reverts to $2,000 afterward. |
| Employer-Provided Child Care Credit | Not directly mentioned in campaign but aligns with family-focused tax strategy. | Enhanced | Credit increased from 25% to 50% of expenses; cap raised to $600,000. |
| Paid Family and Medical Leave Credit | Not mentioned in recent campaign events. | Extended and broadened | Employers can claim credit even if no leave is used; expanded eligibility rules. |
Bottom Line
The 2025 tax proposal offers broader support for families through expanded child-related credits and workplace incentives, but it stops short of establishing a targeted tax credit for stay-at-home parents or unpaid caregivers. Despite earlier campaign statements suggesting such a credit might be introduced, the final legislative language does not include that provision. Families may still benefit from the bill’s increased Child Tax Credit and other family-friendly measures, depending on their income and employment status. As tax policy continues to evolve, working with a financial advisor can be an effective way to assess your eligibility for available credits and optimize your tax situation in the years ahead.
Tax Planning Tips
- A financial advisor can help prepare your portfolio for any tax law changes. A financial advisor can help you mitigate risk for your portfolio. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- If you want to know how much your next tax refund or balance could be, SmartAsset’s tax return calculator can help you get an estimate.
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