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Are You Eligible For The Earned Income Tax Credit?

According to the IRS, approximately 25 million taxpayers received the Earned Income Tax Credit (EITC) in 2021. The average credit amount per taxpayer was around $2,411. For those who qualify, the EITC can help reduce taxes and may even result in a substantial refund. If you’re wondering if you’re eligible for the Earned Income Tax Credit, keep reading to learn more about the credit and how much it could be worth to you.

What is the Earned Income Tax Credit?

The Earned Income Tax Credit (EITC) can give taxpayers with low-to-moderate income a substantial financial boost. That’s because it’s a refundable tax credit.

For the 2022 tax year, the maximum EITC ranges from $560 (no children) to $6,935 (3+ children). The amount you receive is determined by your filing status, income, and the number of qualifying children claimed.

It’s important to note that if you claim the Earned Income Tax Credit, your refund may be delayed. By law, the IRS must wait until mid-February to issue refunds to taxpayers who claim the EITC.

Who is Eligible for the Earned Income Tax Credit?

In general, you must meet the following qualifications to claim the Earned Income Tax Credit on your 2022 tax return:

  • Show proof of earned income ($1 or more)
  • Have $10,300 or less in investment income
  • Be a U.S. citizen or resident alien all year
  • Have a valid Social Security number (SSN)
  • Must not have to file Form 2555 or 2555-EZ

For the EITC, the IRS will not accept Social Security cards that have the words, “Not Valid for Employment,” on them. Individual taxpayer identification numbers (ITIN) or adoption taxpayer identification numbers (ATIN) are also not accepted.

Accepted Filing Statuses

Your filing status must be single, head of household (HOH), widow(er), or married filing jointly. If you are married and filing separately, you may be eligible to claim the EITC if all of the following are true:

  • You are separated but still married;
  • You did not live with your spouse for the last six months of the tax year, or you have a legal separation decree/agreement; and
  • Your qualifying child lived with you for more than half of the year.

Who is Considered a Qualifying Child?

To be eligible as a qualifying child under the Earned Income Tax Credit, children or relatives must meet the following tests:

Age

  • Any age and permanently/totally disabled (learn more here)
  • 18 and younger at the end of the year, and younger than you or your spouse (if filing jointly)
  • Under age 24 and a full-time student (5 months or more during the year), and younger than you or your spouse (if you file jointly)

Students who attend primary, secondary, and post-secondary schools are eligible. Those attending a trade or technical school are also eligible. Students enrolled in on-the-job training, as well as correspondence, and 100% online schools are ineligible.

Relationship

  • Son, daughter, stepchild, adopted child, or foster child
  • Siblings, including stepsiblings and half-siblings
  • Niece, nephew, grandchild

Residency

The qualifying child must live in the same U.S. home as you for at least half of the tax year. A child who was born or died during the tax year, but lived with you for at least six months, is eligible under EITC. In certain cases, a child who temporarily lives away from home may also qualify.

Additionally, if your child files jointly with another taxpayer and claims any tax credits, such as EITC, you cannot claim them. If, however, they file jointly only to receive taxes withheld from a paycheck, they may still be considered a qualifying child.

Additional Requirements For Taxpayers Without Children

If you are claiming the EITC and do not have any children, you must meet all of the following additional requirements:

  • Your main home is in the U.S. for more than 6 months of the year
  • You cannot be claimed as a dependent/qualifying child on another taxpayer’s return
  • You are at least 19 by the end of the tax year

There are some exceptions to the age rule. If you are a qualified former foster youth or a qualified homeless youth, you need to be at least 18. Specified students must be 24 or older.

If your home is located in the 50 states, the District of Columbia, or a military base, it qualifies as a U.S. home. Those located in the Virgin Islands, Guam, Puerto Rico, and other U.S. possessions do not qualify.

Earned Income Tax Credit Income Limits

To claim the Earned Income Tax Credit, you must have earned income (at least $1) and meet certain adjusted gross income (AGI) limits. Earned income typically includes wages, salary, and tips, as well as income from gig work or self-employment. It does not include pensions and annuities, interest, dividends, unemployment benefits, Social Security, alimony, or child support.

For the 2022 tax year, the maximum allowed income levels per filing status are as follows:

2022 EITC Maximum Income Levels

Children or Relatives ClaimedSingle, HOH, or WidowedMarried Filing JointlyMaximum EITC
0$16,480$22,610$560
1$43,492$49,622$3,733
2$49,399$55,529$6,164
3+$53,057$59,187$6,935

The income levels will increase slightly for tax returns due in April 2024, as will the credit amount. For the 2023 tax year, the EITC maximum credit will range between $600 and $7,430, depending on your income, filing status, and the number of qualifying children. You may also have up to $11,000 in investment income.

2023 EITC Maximum Income Levels

Children or Relatives ClaimedSingle, HOH, or WidowedMarried Filing JointlyMaximum EITC
0$17, 640$24,210$600
1$46,560$53,120$3,995
2$52,918$59,478$6,604
3+$56,838$63,398$7,430

Take The EITC Eligibility Test!

If all this information is a bit much to process, don’t stress out. You can easily find out if you are eligible to take the Earned Income Tax Credit and the estimated amount you may receive by using the free EITC Assistant tool provided by the IRS.