Governor Kathy Hochul has signed new legislation that will deliver financial relief to families across New York State. As part of the 2026 State Budget, the New York child tax credit has been significantly expanded—tripling in size and increasing eligibility to reach more than 1.6 million families.
Combined with new inflation refund checks, middle-class tax cuts, and free school meals, the Hochul administration projects the average family could see up to $5,000 in annual savings.
Up to $1,000 per child under the 2025 child tax credit
Starting in 2025, eligible families will receive:
- $1,000 per child under age 4
- $500 per child ages 4–16
This marks the largest expansion of New York’s child tax credit in history, benefiting approximately 2.75 million children statewide. The average family will now receive $943 per year, up from $472 under the previous program.
Key changes include:
- Eliminating restrictions that previously excluded the lowest-income families
- Expanding eligibility to many middle-class families earning up to $170,000
Example: A family of four with a toddler and a school-age child could receive $1,500 annually under the new law—nearly $1,000 more than they previously qualified for.
Middle-class tax cuts hit lowest levels in 70 years
In addition to the child credit expansion, the budget includes nearly $1 billion in income tax cuts for over 8.3 million New Yorkers. These reductions will begin appearing in paychecks by early 2026 and benefit:
- Individuals earning up to $150,000
- Married filers earning up to $323,000
More than 75% of tax filers will see reduced tax withholding, making this the lowest middle-class tax rate in seven decades.
New inflation refund checks up to $400
To offset inflation, New York will issue direct cash refunds to over 8 million residents later this year. No additional action is required to receive the checks.
Amounts include:
- $400 for joint filers earning up to $150,000
- $300 for joint filers earning $150,001–$300,000
- $200 for single filers earning up to $75,000
- $150 for single filers earning $75,001–$150,000
Eligibility is based on 2024 tax returns, and checks will be automatically mailed to qualified recipients.
Free school meals save families $1,600 per child
The FY 2026 budget guarantees free breakfast and lunch for all 2.7 million K-12 students across the state. This includes 280,000 students who previously didn’t qualify.
The program is expected to:
- Save families an estimated $165 per month per child
- Improve attendance, test scores, and classroom behavior
Hochul: “Your family is my fight”
“Putting money back in the pockets of millions of families means helping New Yorkers afford the rising costs of groceries, raising kids, and just enjoying life,” Governor Hochul said during the bill signing.
What’s next for families
Families will begin seeing impacts from the tax credit and meal programs in 2025. Inflation refund checks are expected later this year. Middle-class tax cuts will be reflected in 2026 paychecks.
For more details, residents can visit https://www.tax.ny.gov or check their eligibility when 2024 state tax filing opens.
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