Trump Tax Plan: Stay-at-Home Mom Tax Credit

President Trump signed the One Big Beautiful Bill Act into law on July 4, calling it the “Largest Tax Cuts in History.” With the Tax Cuts and Jobs Act (TCJA) set to expire after 2025, this new law could significantly reshape how families are taxed. While it does not contain a dedicated provision for stay-at-home moms or unpaid caregivers, it expands several credits and deductions that may benefit stay-at-home parents or caregivers more broadly.

A financial advisor can help you understand how these proposed changes may affect your household.

Key Takeaways

Child tax credit goes up: The credit increases to $2,200 per child in 2025, but there’s no new credit for stay-at-home parents.
Some families get more deductions: Families may benefit from a bigger standard deduction, and new tax breaks for tips, overtime, and baby savings accounts.
No tax break for caregivers: Trump’s earlier idea to give a credit to caregivers or stay-at-home parents was not included in the final law.

Trump Tax Plan: Tax Credits That May Benefit Stay-at-Home Moms

While the One Big Beautiful Act 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

The One Big Beautiful Act raises the child tax credit (CTC) to $2,200 per qualifying child for the 2025 tax year. The refundable portion remains capped at $1,400, indexed to inflation, which means some families with limited tax liability can still receive a partial refund. Starting in 2026, both the credit and refundable limit will be adjusted annually for inflation.

To claim the credit, the taxpayer, their spouse (if filing jointly), and each qualifying child must have valid Social Security numbers. There are income-based phaseouts, but many families will remain eligible based on household earnings.

Earlier versions of the bill had proposed a $2,500 credit through 2028. However, the final law reduced the amount to $2,200 with inflation indexing instead of a fixed sunset schedule. No additional credit was added for stay-at-home parents or caregivers.

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 One Big Beautiful Act 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

Employer-Provided Child Care Credit: Expansion

The One Big Beautiful Bill Act increases the employer-provided child care credit. Employers can now claim a credit equal to 50% of qualified child care expenses, up from the previous 25%. The maximum amount of eligible expenses per year also rises to $600,000.

Although the credit is for employers, it may still help stay-at-home parents indirectly in two ways:

Employers may expand child care programs, increasing access and flexibility for dual-income households.
Lower employer costs may reduce out-of-pocket expenses for working spouses who use employer-sponsored child care benefits.

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

The One Big Beautiful Bill Act extends and modifies the employer tax credit for paid family and medical leave through tax year 2026. Under the new law, employers can still claim a credit for providing qualifying paid leave, whether by directly paying wages or by paying insurance premiums for leave coverage.

A key enhancement in the law allows employers to claim the credit even if no employees actually take leave during the year, provided a qualifying leave policy is in place. This change incentivizes employers to maintain compliant leave programs regardless of usage.

While stay-at-home parents do not benefit directly, the expanded credit could increase access to flexible jobs with leave protections, especially in part-time or hybrid roles. This may support caregivers looking to re-enter the workforce with more family-friendly 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.

One Big Beautiful Act vs. Campaign Promises

While the One Big Beautiful Bill Act delivers several family-focused tax provisions, it stops short of introducing credits specifically for stay-at-home parents or unpaid caregivers—both of which Donald Trump had previously mentioned during his 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 One Big Beautiful Act 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. the One Big Beautiful Act

Topic	Campaign Promise	Included in Final Law?	Fact-Check Summary
Child Care Deduction for Stay-at-Home Moms	2016: Trump proposed allowing stay-at-home moms to deduct child care equivalent costs.	No	The bill contains no provision for valuing unpaid caregiving work for tax purposes.
Family Caregiver Tax Credit	2024: Trump said he would support a credit for those caring for a parent or loved one.	No	The final law does not include a caregiver tax credit.
Expanded Child Tax Credit	Not tied to a specific campaign promise, but aligned with general family support.	Yes	The credit is raised to $2,200 in 2025 with inflation indexing starting in 2026.
Employer-Provided Child Care Credit	Not a specific campaign promise.	Yes	Credit increased from 25% to 50%, cap raised to $600,000.
Paid Family and Medical Leave Credit	Not part of campaign platform.	Yes	Credit extended and broadened to include employers who maintain compliant policies, even if no leave is used.

Flexible Savings and Family Planning Accounts

The One Big Beautiful Bill Act does not include a dedicated tax credit for stay-at-home parents, but it does expand several tax-advantaged savings options that may help families manage child-related expenses. One area of focus is the creation and promotion of baby savings accounts, which allow families to begin setting aside money for a child’s future early on. These accounts may receive preferential tax treatment, depending on how the funds are used, and can be useful for both single-income and dual-income households.

Another area where families may benefit is through expanded access to accounts like health savings accounts (HSAs) and dependent care flexible spending accounts (FSAs). These tools allow working spouses to set aside pre-tax money for qualified medical or dependent care expenses. While stay-at-home parents cannot contribute directly without earned income, the overall household can still benefit if one spouse works and uses these accounts to lower taxable income and cover family costs.

Families with only one income may also want to explore how filing status and income-splitting strategies could reduce their overall tax burden. Filing jointly may allow for better use of deductions and credits, including the expanded child tax credit. If the working spouse participates in a retirement plan or health savings program, that may also reduce taxable income, leaving more room to claim other benefits tied to income thresholds.

Although the new law does not offer a direct benefit for unpaid caregivers, it broadens the tools available to households trying to save more efficiently. For stay-at-home parents, understanding how to coordinate savings strategies with a working spouse can help stretch the household budget further and make better use of the expanded credits and deductions included in the law.

Bottom Line

A couple evaluating their tax deduction options.

The One Big Beautiful Bill Act expands several tax credits that could indirectly benefit stay-at-home parents or single-income families, but it does not include the caregiver-specific credits Donald Trump proposed during his campaigns. While the Child Tax Credit increases to $2,200 per child, and employers now receive larger incentives for offering child care and paid leave benefits, there is still no direct tax break for unpaid caregivers or stay-at-home parents. When compared with Trump’s past campaign promises about valuing in-home care or offering caregiver tax credits, the new tax law takes a broader approach focused on family-wide relief rather than targeted support for caregivers.

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.