The Earned Income Tax Credit is a tax reduction for people who work but earn below certain income limits

The Earned Income Tax Credit (EITC) is a federal tax credit that reduces the amount of tax you owe, or increases your refund, based on your work income and family size. You do not have to itemize deductions to claim it. The credit is "refundable," which means if the credit is larger than the tax you owe, the IRS sends you the difference as a refund.

The EITC exists because Congress designed it to supplement wages for working people with lower incomes. The amount you receive depends on how much you earned, whether you have children, and your filing status. The credit phases in as your income rises to a certain point, then phases out as your income continues to climb.

You claim the EITC on your federal tax return using IRS Form 1040 and Schedule EIC (or Schedule 8812 if you have may have access to children). The IRS does not send you a separate notice telling you that you may be may have access to to it — you have to report it yourself when you file.

Key Takeaways

  • The EITC reduces your federal income tax or increases your refund if you work and earn below the income limit for your situation.
  • The credit amount depends on your earned income, number of may have access to children, and filing status — it is not a flat amount for everyone.
  • You must file a federal tax return to claim the EITC, even if your income is so low that you would not normally have to file.
  • Some states offer their own earned income tax credits on top of the federal credit, which you claim on your state return.
  • The IRS provides free tax preparation services through VITA sites and partner organizations if your income is below a certain threshold.

Income limits and credit amounts vary by family size and filing status

The EITC income limits and maximum credit amounts change each year. For the 2023 tax year (filed in 2024), the maximum credit ranges from $560 for workers with no may have access to children to $3,995 for workers with three or more may have access to children. The income limit for a single filer with no children is different from the limit for a married couple filing jointly with children.

The IRS publishes updated limits and amounts each January on its website and in Publication 596. Because these numbers shift annually, you should check the current year's limits before you file. Your tax software or tax preparer will use the correct amounts for the year you are filing.

The credit works in phases: it grows as your income rises from zero up to a peak amount, stays flat for a range of income, then shrinks as your income rises further until it reaches zero. This structure means two workers earning different amounts may receive different credit amounts even if they have the same family size.

Who can claim the EITC: work income, citizenship, and may have access to children

To claim the EITC, you must have earned income from work — wages, salary, self-employment income, or certain other sources. You cannot claim it on investment income, unemployment benefits, or Social Security. You must be a U.S. citizen or resident alien for the entire tax year.

Your filing status matters. Single filers, heads of household, and married couples filing jointly can all claim the EITC. Married couples filing separately cannot. If you are married and file separately, you lose the credit entirely.

If you have children, they must meet specific rules to count as "may have access to children" for the EITC. The child must be your son, daughter, stepchild, foster child, brother, sister, or a descendant of any of these. The child must be under age 17 at the end of the tax year, live with you for more than half the year, and have a valid Social Security number. The child's income must be below a certain limit (which also changes yearly). You can claim the credit for children who do not live with you if they meet the relationship and age tests, but this is less common.

You can claim the EITC with no may have access to children if you meet the age and income requirements. For the 2023 tax year, you must be at least 25 and under 65 at the end of the year (with some exceptions for people with disabilities). Your income must be below the limit for your filing status.

How to claim the EITC on your tax return

You claim the EITC by filing a federal income tax return, even if you earned so little that you would not normally be required to file. The IRS will not automatically calculate it for you or send you a notice that you may be may have access to to it.

If you use tax software, the software will ask you questions about your income, family size, and children. Based on your answers, it will calculate whether you may have access to and how much credit you are may have access to to. If you use a tax preparer, tell them about any children and your total earned income so they can determine whether the EITC applies to you.

You will need your Social Security number, your spouse's Social Security number (if filing jointly), and the Social Security numbers of any may have access to children. You will also need to report your earned income for the year, which appears on your W-2 form if you are an employee, or which you calculate if you are self-employed.

The IRS offers free tax preparation through VITA (Volunteer Income Tax information) sites and partner organizations if your income is below a certain threshold. You can find a VITA site near you through the IRS website. Many community organizations, libraries, and nonprofits also offer free tax help during filing season.

State earned income tax credits and how they stack with the federal credit

Twenty-nine states and the District of Columbia offer their own earned income tax credits in addition to the federal EITC. These state credits are separate from the federal credit and are claimed on your state tax return, not your federal return.

State credits vary widely. Some states offer a credit that is a percentage of the federal credit — for example, 20 percent of whatever federal credit you receive. Other states have their own income limits and credit amounts that differ from the federal structure. A few states offer credits only for workers with children, while others allow workers without children to claim them.

If your state offers an EITC, you will claim it on your state income tax return using the form your state tax agency provides. Your tax software will usually prompt you to enter the information needed for your state credit. If you are not sure whether your state has an EITC, check your state's tax agency website or ask your tax preparer.

The difference between the EITC and the Child Tax Credit

The Child Tax Credit and the EITC are two separate federal credits that both involve children, but they work differently. The Child Tax Credit is worth up to $2,000 per may have access to child (as of 2023) and is available to a wider range of income levels. The EITC is worth more for lower-income workers but phases out at lower income levels.

You can claim both credits in the same year if you meet the requirements for each. A may have access to child for the Child Tax Credit must be under 17 at the end of the year and meet relationship and residency tests similar to the EITC. However, the income limits for the Child Tax Credit are higher, so you may be able to claim it even if your income is too high for the EITC.

Your tax software or preparer will calculate both credits and explore whichever ones you are may have access to to. You do not have to choose between them — the IRS will use both if you may have access to for both.

What happens if you claim the EITC and your income changes during the year

If your income during the year was different from what you expected when you claimed the EITC, you may have received too much or too little credit. When you file your tax return, the IRS compares the credit you claimed (if you claimed it in advance) to the credit you are actually may have access to to based on your final income for the year.

If you received too much credit, you will owe the difference back to the IRS when you file your return. If you received too little, the IRS will send you the additional amount as part of your refund. This is why it is important to report your actual earned income for the full year when you file, not an estimate.

If you are self-employed or your income is unpredictable, you may want to wait until after the year ends to claim the EITC on your tax return rather than trying to claim it in advance. This way, you can report your actual income and avoid owing money back later.

Frequently Asked Questions

Do I have to file a tax return to get the EITC if I did not earn enough to owe taxes?

Yes. The IRS does not automatically send you the EITC — you must file a federal tax return to claim it, even if your income is below the filing requirement. Filing is how you tell the IRS that you are may have access to to the credit.

Can I claim the EITC if I am self-employed?

Yes. Self-employment income counts as earned income for the EITC. You will need to report your net self-employment income on Schedule C and then claim the credit on your tax return. Your tax preparer or software can help you calculate your net income correctly.

What if my child does not have a Social Security number?

Your child must have a valid Social Security number to count as a may have access to child for the EITC. If your child does not have one, you cannot claim the credit for that child. You may still be able to claim the credit as a worker with no may have access to children if you meet the age and income requirements.

Can I claim the EITC if I am married but file my taxes separately from my spouse?

No. Married couples filing separately cannot claim the EITC. If you are married, you must file jointly to be may have access to to the credit. This is one of the few tax situations where filing separately disqualifies you from a benefit entirely.

What if the IRS says I claimed too much EITC and owes money back?

The IRS will reduce your refund or send you a bill for the amount you owe. You can dispute this if you believe your income was reported incorrectly, but you will need documentation of your actual earned income for that year. If you cannot pay the full amount, you can set up a payment plan with the IRS.