EITC, the Earned Income Tax Credit, sometimes called EIC is a tax credit to help you keep more of what you earned. It is a refundable federal income tax credit for low to moderate income working individuals and families. Congress originally approved the tax credit legislation in 1975 in part to offset the burden of social security taxes and to provide an incentive to work. When EITC exceeds the amount of taxes owed, it results in a tax refund to those who claim and qualify for the credit.
To qualify, you must meet certain requirements and file a tax return, even if you do not owe any tax or are not required to file.
Do You Qualify for EITC?
To qualify for EITC you must have earned income from employment, self-employment or another source and meet certain rules. Also, you must either meet the additional rules for workers without a qualifying child or have a child that meets all the qualifying child rules for you.
Earned Income Tax Credit Rules for Everyone
To qualify for Earned Income Tax Credit or EITC, you and your spouse if married and filing a joint return, must meet all of the following rules:
- Have a Social Security Number that is valid for employment
- Have earned income from employment, self-employment or another source
- Cannot use the married, filing separate filing status
- Must be a U.S. citizen or resident alien all year or a nonresident alien married to a U.S. citizen or resident alien and choose to file a joint return and be treated as a resident alien
- Cannot be the qualifying child of another person*
- Cannot file Form 2555 or 2555-EZ (related to foreign earned income)
- Your Adjusted Gross Income and earned income must meet the limits shown on the Income Limits, Maximum Credit Amounts and Tax Law Updates Page
- Your investment income must meet or be less than the amount listed on the Income Limits, Maximum Credit Amounts and Tax Law Updates Page
Find out if you are eligible for the EITC by answering a few questions and providing basic income information, using the IRS’s online EITC Assistant web tool. The assistant also helps determine if your child meets the rules for a qualifying child and estimates the amount of your credit. Find the English EITC Assistant here or o haga click aquí para seleccionar la Versión en Español del Asistente.
Special EITC Rules
There are special EITC rules for members of the military, ministers, members of the clergy and those receiving disability benefits. Find out more about the special EITC rules.
Rules for those Without a Qualifying Child
If you and your spouse, if filing a joint return, meet the EITC Rules for Everyone and you do not have a qualifying child, you may be eligible for EITC. Find the rules for those without a qualifying child here.
EITC Income Limits, Maximum Credit Amounts and Tax Law Updates
See the EITC Income Limits, Maximum Credit Amounts and Tax Law Updates for the current year, previous years and the upcoming year.
Special EITC Rules
Special EITC rules for members of the military, ministers, members of the clergy, those receiving disability benefits and those impacted by disasters. Read more about the special rules.
Disability and EITC
Many persons with disabilities or persons having children with disabilities qualify for the Earned Income Tax Credit or EITC. Find out more about Disability and EITC.
Please contact Chicago CPAs at 773-728-1500