Finance & Money
The Earned Income Tax Credit, explained without the refund pitch
A credit for people with earnings below a threshold, and the subject of an entire advertising industry that charges for things the IRS provides free.
The EITC is a refundable credit, which means it can produce a refund larger than the tax withheld. The amount depends on earnings, filing status and the number of qualifying children, and the thresholds are set each year by the IRS. It has to be claimed on a return — there is no separate application and it is not paid automatically.
The IRS publishes an assistant tool that walks through the conditions, and that tool is the authority. Any figure quoted elsewhere is a figure for a particular year and a particular household, which is why none appears here.
Returns claiming this credit are held longer than others by law, so the refund arrives later in the season than people expect. That delay is normal and is not a sign of a problem with the return.
The advertising to be careful of sells speed: a refund anticipation loan is borrowing against a refund at a cost, and free preparation is available to filers under an income threshold through IRS-sponsored volunteer programmes. Paying for both the preparation and the speed is the expensive path.
What to do next. Use the IRS's own EITC assistant to check the conditions, and look up a free volunteer tax preparation site before paying a preparer.
studentaid.gov outranks this page. Rules, figures and dates change
between academic years. This is written to help you read the official sources, not to
stand in front of them. Start there.
Nothing here is a determination. We cannot tell you what you qualify
for, and no website can. The programme and the office that runs it decide that, after
you apply.
Still have a question?
Describe what you are trying to work out and a member of the team will answer, or direct you to the office that makes the decision.