Earned Income Tax Credit, EIC or EITC

earned income tax credit

Beaver Dam, Wisconsin
D. Hoefler @johnwestrock

The Earned Income Tax Credit - EIC or EITC - is a refundable tax credit for taxpayers who earn low or moderate incomes. This credit is meant to supplement your earned income, income you have earned through working, whether for yourself self-employed or for someone else. Learn more about taxable income and tax free income.

If you qualify for the Earned Income Tax Credit you can reduce your taxes and increase your tax refund. The EITC allows more taxpayers to keep more of their hard-earned money. The credit is for earned income only and there are income limits that are adjusted every year, so even if you didn’t qualify for the EITC in the past, you may be able to claim it this year.

We have three easy ways for you to find out if you qualify for the EITC and what your 2020 EIC amount might actually be in 2021:

Do you Qualify For the 2020 Earned Income Tax Credit?
A: Do I?: Simply launch this easy to use interactive tool. Answer a few important question about yourself and voila you will get your answer. No need to read Tax Mumbo Jumbo.
B: If so, How much? If you wonder what your actual Earned Income Tax Credit will be. Read no further.
C: Let's Make IT happen! IT is Income Taxes. Start Your 2020 Return now and the eFile Tax App will figure this all out for you. No guessing, or wondering not guessing about IT.
Start and PrepareIT. But not Alone. We are there with you all thew way.

EITC Requirements, Qualifications

What would taxes be without more requirements? It is estimated that 1 out of 5 people who qualify for the EITC think they don't qualify for it or used to not claim it on their tax returns. You do not have to worry about this if you eFile your tax return on eFile.com. The eFile Tax App will detect for you if you qualify for the Earned Income Credit or not.

The following taxpayers are more likely to not claim the Earned Income Tax Credit if they don't use a tax program like eFile.com:

Singles with no children or dependents are the largest group of qualifying taxpayers who think they do not qualify for the Earned Income Tax Credit on their Taxes or they did not claim the EITC on their tax returns in the past. Attention: Even if you are not married and/or have no children, you may still be able to claim the credit. You qualify for the EITC as long as you were at least 25 but younger than 65 on Dec. 31 of the tax year, you earned income through work, and you met the income limits specified above. eFileIT and you know you will not miss IT!

Other taxpayers that frequently think they do not qualify for the Earned Income Tax Credit are: the self-employed, taxpayers in rural areas, grandparents raising their grandchildren, recently divorced couples, recently unemployed taxpayers, taxpayers with no children, recipients of disability benefits.

Again, don't let this happen to you! When you prepare your tax return on eFile.com, we will automatically check to see if you qualify for the EITC, calculate the amount of your credit, and fill out the right forms for you to claim it.

Important: Even if you don't owe income taxes or you think you don't have to file a return, you could still get the Earned Income Tax Credit as a form of a tax refund when you prepare and eFile or file a return. First, start and use the free EICucator tax tool - Earned Income Credit Educator- to see if you qualify for the EITC.

Earned Income Credit Limits Criteria etc. for Tax Year 2020
Zero
One
Two
Three Plus
2020 AGI Limit for Filing Status: Single, Head of Household, or Widowed
$15,820
$41,756
$46,703
$50,162
2020 AGI Limit for Filing Status: Married Filing Jointly
$21,370
$46,884
$52,493
$55,952
Maximum EITC Amounts
$6,660 with three or more qualifying children
$5,920 with two qualifying children
$3,584 with one qualifying child
$538 with no qualifying children.
Investment Income Limit
Investment Income Limit $3,650 or less for Tax Year 2020.
Earned Income Tax Credits in 2021, 2019, 2018 and 2017

Additional requirements to qualify for the Earned Income Tax Credit.

  • You, your spouse if Married Filing Jointly, and any Qualifying Children you claim must each have a valid Social Security Number.
  • You must have earned income (from wage employment or self-employment).
  • Your filing status cannot be Married Filing Separately.
  • You must be a U.S. citizen or resident alien for the whole year, or a nonresident alien married to a U.S. citizen or resident alien and filing a joint return.
  • You cannot be the Qualifying Child (for the Earned Income Credit) of another person.
  • Your Qualifying Child for the EITC cannot be used by more than one person to claim the EITC.
  • If you do not have a Qualifying Child, you must:
    • be at least 25 but younger than 65 at the end of the tax year
    • live in the United States for more than half the year
    • not be the Qualifying Child of another person.
  • You cannot file Form 2555 (Foreign Earned Income).
  • More detailed PDF based Information on the Earned Income Tax Credit

    The EITC can be confusing. If you need more help determining if you are eligible for the Earned Income Tax Credit and figuring the exact amount of your credit, you should just begin preparing a tax return using eFile.com and we will calculate your EITC credit amount for you.

    • Members of the Military - Members of the armed forces do not normally include nontaxable pay, such as combat pay, in their earned income when calculating the Earned Income Credit. However, they may choose to include nontaxable pay in their earned income for the purposes of calculating the EITC. This may have the effect of increasing their credit amount.
    • Members of the Clergy - The housing allowance provided for a member of the clergy as a part of their pay is not normally included in taxable income, but it is reported as a part of their net earnings from self-employment. Therefore, the housing allowance (or rental value of the home) may be included in earned income for the purposes of calculating the Earned Income Tax Credit.
    • Those Receiving Disability Benefits - Disability retirement benefit payments are included in earned income if you are younger than your minimum retirement age (the earliest age you could have received a pension had you not been disabled). After your minimum retirement age, any disability benefit payments will be considered taxable pension payments and may not be counted as earned income. Social Security Disability Insurance and private disability insurance payments for which you paid the premiums are not considered earned income for the purposes of calculating the EITC.
    • Adopted Children - If your adopted child has not yet been issued a Social Security Number, he/she may be assigned an Adoption Taxpayer Identification Number for tax purposes. Unfortunately, this number may not be used to claim a Qualifying Child for the Earned Income Credit. To claim the EITC, you may file an amended tax return once your child has been assigned their SSN. Learn more about tax amendments. If you have adopted a child, find out about the Adoption Tax Credit.
    • The IRS - not eFile.com - has not been processing federal tax refunds to taxpayers who are claiming the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) before mid-February. The IRS is required to hold the entire tax refund, including the portion not associated with the credits mainly for security and fraud prevention reasons. The additional time will ensure taxpayers to receive the refund they’re due.
    • Parents Only Claiming the EITC for Dependent: You can only claim the EITC for a dependent if you relinquished your dependency exemption and assigned it to the non-custodial parent via filing Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent. However, if the IRS sends you an audit letter requesting more information from you, you need to complete, sign, and mail Form 886-H-EIC to the IRS. Attach any documents listed on the form to prove that you can claim the EITC.

    State and Local Earned Income Tax Credits

    Twenty-four states, the District of Columbia and New York City have their own Earned Income Tax Credits. All of them except Delaware, Maine, Ohio and Virginia have refundable credits. If you are filing a tax return for one of these states, we will help determine if you qualify for a state or local EITC, as well as the Federal EITC, when you prepare your tax return on eFile.com.

    States with Local Earned Income Tax Credits:

    1. California
    2. Colorado
    3. Connecticut
    4. Delaware
    5. District of Columbia
    6. Illinois
    7. Indiana
    8. Iowa
    9. Kansas
    10. Louisiana
    11. Maine
    12. Maryland
    13. Massachusetts
    14. Michigan
    15. Minnesota
    16. Nebraska
    17. New Jersey
    18. New Mexico
    19. New York
    20. New York City, NY
    21. Oklahoma
    22. Oregon
    23. Rhode Island
    24. Vermont
    25. Virginia
    26. Wisconsin

    Summary To Claim the EITC

    When you prepare your tax return on eFile.com, we will automatically check to see if you qualify for the Earned Income Tax Credit. If you qualify for the EITC, eFile.com will calculate the exact amount of your credit for you. It will also generate the form(s) you need to claim your full credit and prepare them for you. See other tax credits and tax deductions you may qualify for on your tax return.

    EITC by Tax Year, Future and Back Taxes

    Earned Income Credit Limits Criteria etc. for Tax Year 2021
    Zero
    One
    Two
    Three Plus
    2021 AGI Limit for Filing Status: Single, Head of Household, or Widowed
    $TBD
    $TBD
    $TBD
    $TBD
    2021 AGI Limit for Filing Status: Married Filing Jointly
    $TBD
    $TBD
    $TBD
    $TBD
    Maximum EITC Amounts
    $TBD with three or more qualifying children
    $TBD with two qualifying children
    $TBD with one qualifying child
    $538 with no qualifying children.
    Investment Income Limit
    Investment Income Limit $$TBD or less for Tax Year 2021.

    Earned Income Credit Limits Criteria etc. for Tax Year 2019
    Zero
    One
    Two
    Three Plus
    2019 AGI Limit for Filing Status: Single, Head of Household, or Widowed
    $15,570
    $41,094
    $46,703
    $50,162
    2019 AGI Limit for Filing Status: Married Filing Jointly
    $21,370
    $46,884
    $52,493
    $55,952
    Maximum EITC Amounts
    $529 with no qualifying children
    $3,526 with one qualifying child
    $5,828 with two qualifying children
    $6,557 with three or more qualifying children.
    Investment Income Limit
    Investment Income Limit $3,600 or less for Tax Year 2019.

    Earned Income Credit Limits Criteria etc. for Tax Year 2018
    Zero
    One
    Two
    Three Plus
    2018 AGI Limit for Filing Status: Single, Head of Household, or Widowed
    $15,270
    $40,320
    $45,802
    $49,194
    2018 AGI Limit for Filing Status: Married Filing Jointly
    $20,950
    $46,010
    $51,492
    $54,884
    Maximum EITC Amounts
    $519 with no qualifying children.
    $3,461 with one qualifying child
    $5,716 with two qualifying children
    $6,431 with three or more qualifying children.
    Investment Income Limit
    Investment Income Limit $3,500 or less for Tax Year 2018.

    Earned Income Credit Limits Criteria etc. for Tax Year 2017
    Zero
    One
    Two
    Three Plus
    2017 AGI Limit for Filing Status: Single, Head of Household, or Widowed
    $15,051
    $39,617
    $45,007
    $48,340
    2017 AGI Limit for Filing Status: Married Filing Jointly
    $20,600
    $45,207
    $50,597
    $53,930
    Maximum EITC Amounts
    $510 with no qualifying children
    $3,400 with one qualifying child.
    $5,616 with two qualifying children
    $6,318 with three or more qualifying children
    Investment Income Limit
    Investment Income Limit $3,450 or less for Tax Year 2017.

    Earned Income Credit Limits Criteria etc. for Tax Year 2016
    Zero
    One
    Two
    Three Plus
    2016 AGI Limit for Filing Status: Single, Head of Household, or Widowed
    $14,880
    $39,296
    $44,648
    $47,955
    2016 AGI Limit for Filing Status: Married Filing Jointly
    $20,430
    $44,846
    $50,198
    $53,505
    Maximum EITC Amounts
    $506 with no qualifying children
    $3,373 with one qualifying child.
    $3,373 with two qualifying children
    $6,269 with three or more qualifying children
    Investment Income Limit
    Investment Income Limit $3,400 or less for Tax Year 2016.

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