There’s an IRS credit available to qualifying taxpayers in the United States and not everyone is aware that they could qualify. The Internal Revenue Service has made up to $7,830 available under the Earned Income Tax Credit and it could translate into cash in your pocket in tax season. You can find the eligibility criteria below.
The EITC could mean $7,830 back to you in tax season
Tax season for 2025 opened on January 27, which means it’s time for U.S. taxpayers to start filing their 2024 returns with the Internal Revenue Service. There are several tax breaks available to filers who qualify under specific conditions, and one of these is the Earned Income Tax Credit (EITC).
The maximum amount available under the EITC for the 2024 tax return is $7,830. This will go up to $8,046 in fiscal year 2025, meaning when you file next year in January 2026, the credit will be around 2.7% higher. This annual increase is not based on the Cost-of-Living Adjustment (COLA) but is tied to inflation.
In addition to the EITC, there’s an increased Child Tax Credit on the cards for New Yorkers if Governor Kathy Hochul has her way. Gov. Hochul is focused on addressing the high cost of living and she plans to raise the tax credit for households with children.
The EITC is intended to ease the burden on low and moderate-income earners
The Earned Income Tax Credit targets the lower-earning end of the American population of low to moderate-earning workers. The IRS allows EITC-qualifying taxpayers to either reduce their liability or increase their refund. The amounts made available according to the criteria range from $632 to $7,830. Two of the factors that affect how much the credit will be are the number of dependents the claimant has and their annual income.
Who is eligible for the Earned Income Tax Credit?
Taxpayers who want to claim the EITC must comply with earned income and certain adjusted gross income (AGI) thresholds. There are also limits on the credit that take current, prior, and future tax years into account.
Here are the eligibility criteria for the credit:
- The income thresholds are set at $59,899 for individuals and $66,819 for couples who file their tax returns jointly. This means that anyone who earns more than this will not qualify for the EITC.
- A claimant’s investment income must not have exceeded $11,600 in the 2024 tax year.
- Taxpayers claiming the EITC must have a valid Social Security number by the due date for the 2024 tax return.
- Claimants must have been either a U.S. citizen or resident alien for the entire tax year.
- Anyone who files Form 2555 for foreign-earned income is not allowed to claim the EITC.
- If a taxpayer who previously filed joint returns is now separated from their partner, there are additional specific rules to be met that can be investigated with the IRS directly.
The IRS has a virtual assistant service available on its official website that can help with determining eligibility and many other queries.
How much can taxpayers claim under the EITC?
Below are the amounts that the IRS will issue as a credit depending on how many minor dependents a claimant has.
- No qualifying children: $632 for tax year 2024 (this goes up to $649 for the 2025 fiscal year when returns are filed in 2026)
- One child: $4,213 ($4,328 for 2025)
- Two children: $6,960 ($7,152 for 2025)
- Three or more children: These taxpayers are credited with the maximum amount of $7,830 ($8,046 in 2025)
Frequently-asked questions
- What happens if my tax liability is zero or less than the credit?
The value after your tax liability is paid out as a refund.
- How do I claim the EITC when I file my taxes?
There is a section to claim the Earned Income Tax Credit on either IRS tax return Form 1040 or Form 1040-SR.
- When can I expect the EITC refund to be processed?
The IRS reports that most EITC refunds will become available by February 27. After filing your return, you should allow 21 days for the direct deposit refunds to be processed for those who filed electronically and between six and 12 weeks for refunds posted via mail.
- How can I check the status of my refund?
Taxpayers can consult the following resources for inquiries: The IRS Where’s my refund? tool; the IRS2Go App; the Internal Revenue Service website; or the virtual assistant tool on the IRS website.
Remember to only trusted, verified, official sources for reliable information and stay informed so that you don’t miss opportunities to maximize your tax refunds and plan accordingly.