About the Earned Income Tax Credit (EITC)
The EITC is a special tax benefit for working people who earn low or moderate incomes. The EITC reduces the tax burden, supplements wages and makes work more attractive than welfare for these workers.
Workers who qualify for the EITC and file a federal tax return can get back some or all of the federal income tax that was taken out of their pay during the year. They may also get extra cash back from the IRS. Even workers whose earnings are too small to have paid taxes can get the EITC. What's more, the EITC reduces any additional taxes workers may owe, such as payroll taxes.
EITC eligibility and maximum amounts for 2016
Single or married people who worked full-time or part-time at some point in 2016, and have a valid Social Security Number (Individual Taxpayer Identification Numbers or ITINs do not qualify) can qualify for the EITC, depending on their income. Workers who were:
- Raising one child in their home and had family income of less than $39,296 (or $44,846 for married workers) in 2016 can get an EITC of up to $3,373.
- Raising two children in their home and had family income of less than $44,648 (or $50,198 for married workers) in 2016 can get an EITC of up to $5,572.
- Raising three or more children in their home and had family income of less than $47,955 (or $53,505 for married workers) in 2016 can get an EITC of up to $6,269.
- Not raising children in their home but were between ages 25 and 64 on December 31, 2016, and had income below $14,880 (or $20,430 for married workers) can get an EITC of up to $506.
Children who qualify for the EITC
"Qualifying children" include: sons, daughters, stepchildren, grandchildren and adopted children. Brothers, sisters, stepbrothers or stepsisters -- as well as descendants of such relatives -- if they were cared for as members of the family. Foster children may qualify, but only if they are placed with the worker by an authorized government or private placement agency. Qualifying children must be under age 19 or under age 24 if they are full-time students. They must live with the worker for more than half of the year. Totally and permanently disabled persons of any age also are considered qualifying children. Valid Social Security numbers are required for qualifying children born before December 31, 2016.
How to get the EITC
Workers raising children in 2016 must file either Form 1040 or 1040A (not the 1040EZ) and attach Schedule EIC. Married workers must file a joint return.
Workers who were not raising children in 2016 can file any tax form, including the 1040EZ (write "EITC" or the dollar amount of the credit on the Earned Income Credit line on the tax form), and they do not file Schedule EIC.
More information about the EITC
- Impact on public benefits: In most cases, the EITC does not affect eligibility for benefits like cash assistance ("welfare"), Medicaid, Food Stamps, SSI, or public or subsidized housing.
- EITC for immigrant workers: Many legal immigrants can qualify for the EITC, as long as they meet the eligibility requirements and have a valid Social Security Number.
- IRS EITC Assistant: Visit the IRS Online EITC Assistant to find out if you are eligible for the Earned Income Tax Credit (EITC) and estimate the amount by answering a few simple questions and providing basic income information.
- Even more about the EITC: Read IRS Publication 596, or call the EITC
Hotline at 2-1-1 (in Denver) or 1-866-760-6489 (outside of the Denver metro area).