About EITC

EITC, the Earned Income Tax Credit, sometimes called EIC or Earned Income Credit is a refundable tax credit. Meaning, EITC can reduce the federal tax to zero and any unused credit is refunded. But, workers must file a tax return to get the credit even if their income is below the filing requirement. To qualify, workers must have taxable income from working for someone or from running a business or farm.

EITC is one of the Largest Antipoverty Programs

  • Last year, over 27 million received over $63 billion in EITC for 2012.1 

 

  • The average amount of EITC paid out  in 2013 was $2,335.1


 

  • Four of five people eligible for the credit claim it 


  • EITC lifted an estimated 6.5 million people out of poverty, including 3.3 million or half of them children2  


  • The cost of administering the EITC program ratio to claims paid is less than one percent
1¹Source: EITC Calendar Year Report, December 2013
²Source: Policy Basics: Earned Income Tax Credit, Center on Budget and Policy Priorities, January 30, 2014

Basic EITC Eligibility Requirements

Determining eligibility for EITC is complicated. You must make over 20 separate determinations. This tool kit presents the basic qualifiers.  Refer to the EITC Home Page on irs.gov IRS for more detailed information.

EITC Income Limits, Maximum Credit Amounts, and Tax Law Updates

Income and family size determine the amount of the EITC. The income amounts and the amount of EITC are adjusted for inflation each year. 

 

Who are we missing?

We estimate that four out of five workers claim the EITC they earned. Help IRS reach the potentially qualifying workers who miss out on thousands of dollars every year on EITC.  Help us educate them about the credit and motivate them to join the four out of file who file and claim it.  This includes workers who are: 

  • living in rural areas,
  • self-employed,
  • receiving certain disability pensions or have children with disabilities,  
  • without a qualifying child,
  • not proficient in English,
  • Grandparents raising their grandchildren, or
  • recently divorced, unemployed, or experienced other changes to their marital, financial or parental status 

 More about EITC

 

 

Page Last Reviewed or Updated: 27-Mar-2014