The Earned Income Tax Credit goes to working people with low to moderate income, and the amount depends on how much you earned and whether you have children

The Earned Income Tax Credit (EITC) is a refundable tax credit — meaning you can get money back even if you owe no tax at all. To receive it, you must have earned income from a job or self-employment, your total income must fall below a certain threshold, and you must meet other requirements that vary by your filing status and whether you have dependents. The credit is largest for people with children, but workers without children can also receive it if their income is low enough.

The IRS administers the EITC, and you claim it when you file your federal tax return. You do not apply separately or wait for approval — you report your income and family situation on your return, and the IRS calculates whether you may have access to and how much you receive. If you are may have access to to the credit, it reduces what you owe in taxes or increases your refund.

Key Takeaways

  • You must have earned income from work in the tax year you claim the credit; investment income, unemployment benefits, and disability payments do not count.
  • Income limits vary by filing status and number of children, ranging from around $16,000 for single filers with no children to over $60,000 for married filers with three or more children.
  • The credit is largest for people with one, two, or three or more children; the amount phases out as income rises.
  • You claim the EITC on your federal tax return using Form 1040 and Schedule EIC; you do not need to file a separate application.
  • If you think you may have missed the credit in past years, you can file an amended return up to three years back.

Income and Earned Income Requirements

To receive the EITC, your earned income must come from wages, salary, tips, or net self-employment income. Income from interest, dividends, capital gains, rental property, unemployment benefits, Social Security, disability payments, or workers' compensation does not count toward the credit. If you are self-employed, your net profit from your business counts as earned income.

Your total income — earned income plus any other income — must stay below the limit for your situation. The IRS sets these limits each year, and they change slightly to account for inflation. For the 2023 tax year, the income limit for a single filer with no children was around $16,810; for a married couple filing jointly with three or more children, it was around $63,398. These numbers shift annually, so check the IRS website or your tax software for the current year's limits.

If you are married, you must file a joint return to claim the credit. If you are single or head of household, you file under your own status. Your filing status and the number of may have access to children determine which income limit applies to you.

How Many Children You Have Affects the Credit Amount

The EITC is designed to help working families, and the credit is significantly larger if you have children. The IRS recognizes three tiers: the credit for workers with no children, the credit for those with one child, the credit for those with two children, and the credit for those with three or more children. Each tier has its own income limit and maximum credit amount.

A child must be your biological child, adopted child, or stepchild to count. The child must be under age 17 at the end of the tax year, live with you for more than half the year, and be a U.S. citizen, national, or resident alien. You must also provide their Social Security number on your return. If you have a may have access to child, you will receive a larger credit than if you have no children, even if your income is the same.

The credit amount increases as your earned income rises, reaches a maximum, and then decreases as your income continues to climb. This means two people earning different amounts may receive different credit amounts, even if both have one child.

Age and Residency Rules for Workers Without Children

If you have no may have access to children, you can still receive the EITC, but the rules are stricter. You must be at least 25 years old and under 65 at the end of the tax year. You must also have lived in the United States for more than half the tax year, and you cannot be claimed as a dependent on someone else's return.

The income limit for workers without children is much lower than for those with children — around $16,810 for single filers in 2023 — and the maximum credit amount is also smaller. This version of the credit is intended for low-income workers and is less commonly claimed than the credit for families with children.

How to Claim the EITC on Your Tax Return

You claim the EITC by filing your federal income tax return. If you use tax software, the program will ask you questions about your income, filing status, and dependents, and it will calculate whether you may have access to and how much the credit is worth. If you file by paper, you use Form 1040 (the main individual income tax form) and Schedule EIC, which is a worksheet that calculates your credit.

You do not need to contact the IRS in advance or submit proof of your income before filing. You report your income on your return, and the IRS reviews it. If the IRS has questions later, they may ask for documentation such as pay stubs, a birth certificate for a child, or proof of residency. Keep records of your income and any documents related to your dependents for at least three years.

If you receive the credit and the IRS later determines you were not may have access to to it, you may have to repay part or all of it. This can happen if your income was higher than you reported, if a child did not meet the residency requirement, or if you claimed a child who was not your dependent. The IRS will send you a notice explaining what happened and how much you owe.

What Happens If You Received the Credit in Error

If you claimed the EITC in a previous year and later find out you did not may have access to, or if the IRS audits your return and denies the credit, you may owe the money back. The amount you repay depends on your current income and filing status. If your income is very low, the IRS may reduce or eliminate the repayment amount under a rule called the Earned Income Tax Credit Recapture Provision.

If you think you made a mistake on a past return, you can file an amended return using Form 1040-X. You have up to three years from the original due date of the return to amend it. If you are amending to claim the EITC for a year you did not claim it before, you can do so within this three-year window.

Frequently Asked Questions

Can I get the EITC if I did not earn enough to owe taxes?

Yes. The EITC is refundable, which means you can receive it even if you owe no federal income tax. If the credit is larger than the tax you owe, the IRS sends you the difference as a refund. This is one reason many low-income workers file a return even though they have no tax liability.

What if my income is right at the limit?

If your income is at or slightly above the limit for your situation, you do not may have access to. The IRS uses your Modified Adjusted Gross Income (MAGI) to determine this, which is slightly different from your total income. Tax software and the IRS instructions will help you calculate your MAGI correctly.

Can I claim a child who does not live with me full-time?

No. The child must live with you for more than half the tax year. If you share custody and the child lives with you for exactly half the year, you do not meet this requirement. The parent with whom the child lives for the greater number of nights can claim the child.

Do I have to file a tax return to get the EITC?

Yes. You must file a federal income tax return to claim the credit. If your income is below the filing requirement, you still need to file to receive the EITC. Many tax preparation organizations offer free filing services to low-income workers.

What if my income changes during the year?

You claim the EITC based on your total income for the entire tax year. If you had a job for part of the year and were unemployed for the rest, you add up all your earned income from that year. Your income for the year determines whether you may have access to and how much the credit is worth.