Ryan Tucker, whose wife was struck on the shoulder by the cab, said after he checked his wife was OK, he went to help the young boy.
“She was coherent, she was talking to her son, smiling, trying to help keep him calm.”
Video shared on social media shows a group of people rocking the taxi back to free the mother and son.
Tucker said the boy, who was hospitalised with an injury to his thigh, told him it was the worst holiday ever.
Two others were also transported to hospitals for their injuries, all in a stable condition, including a 41-year-old woman who reportedly suffered a head injury and a 49-year-old woman who reportedly suffered a leg injury.
Three others, reportedly aged 19, 37 and 49, refused medical attention.
A New York Police Department spokesperson said the 58-year-old taxi driver may have suffered a medical episode, but the investigation had yet to confirm that as the cause.
The taxi jumped the curb near Macy’s flagship store at Herald Square about 4pm on Wednesday (8am Thursday AEDT) and hit the pedestrians on the footpath, police said, adding that the driver remained at the scene.
Video footage from the scene showed a damaged yellow taxi on the sidewalk cordoned off by police tape. The car’s front bumper appeared to have fallen off.
The taxi was towed away later in the evening.