Proposed barring people who aren't "qualified aliens" from the refunded portion of four tax credits. They are the child tax credit, earned income credit, American opportunity credit and adoption credit. Treasury estimates 200,000 to 700,000 taxpayers would be ineligible in 2026, or $0.7 billion to $2.6 billion in credits. The IRS's draft 2026 Form 1040 would also ask every filer whether they, and a spouse filing jointly, are "a U.S. citizen, U.S. national, or an alien lawfully authorized to work in the U.S."
- Aug 20, 2026Proposed barring people who aren't "qualified aliens" from the refunded portion of four tax credits. They are the child tax credit, earned income credit, American opportunity credit and adoption credit. Treasury estimates 200,000 to 700,000 taxpayers would be ineligible in 2026, or $0.7 billion to $2.6 billion in credits. The IRS's draft 2026 Form 1040 would also ask every filer whether they, and a spouse filing jointly, are "a U.S. citizen, U.S. national, or an alien lawfully authorized to work in the U.S." Source ↗
- LatestTreasury's proposed rule is open for public comment until Oct 5, 2026. It is not final. Source ↗
How to roll it backTreasury can withdraw the proposed rule before it is final, and the IRS can remove the question from the form. Congress can decide by law which credits count as federal public benefits.
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