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This tax season, the IRS expects more than 140 million individual returns — and many filers could miss a credit worth thousands of dollars.
The earned income tax credit, or EITC, is a tax break for low- to moderate-income workers. In 2023, eligible taxpayers received an average credit of $2,743, according to the IRS.
“Every year, millions of households receive the EITC,” former IRS Commissioner Danny Werfel told reporters in early January. But “nearly one in five eligible taxpayers don’t claim this valuable credit because they don’t know about it or don’t realize they qualify.”
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For 2024, the EITC is worth up to $7,830 for families with three or more children, up from $7,430 in 2023, according to the IRS. Eligible workers, between the ages of 25 and 64, without kids can claim up to $632 for 2024.
By law, the IRS can’t issue EITC refunds before mid-February, according to the agency. However, most early tax filers will see a status update in the “Where’s My Refund?” portal by Feb. 22. Refunds should arrive by March 3 if you chose direct deposit and there are no issues with your tax return.
How the earned income tax credit works
The EITC “can be confusing,” said Syracuse University law professor Robert Nassau, director of the school’s low-income tax clinic.
For tax year 2024, you may be eligible with “earned income” or wages from working of $59,899 or less for single filers and $66,819 for married couples filing jointly, according to the IRS. These income limits decrease based on the number of qualifying children.
These limits use adjusted gross income, which is your total income after subtracting pretax 401(k) plan contributions and “adjustments,” such as certain pretax individual retirement account contributions, student loan interest and educator expenses.
Other EITC requirements include:
- Your investment income can’t be above $11,600
- You must be a U.S. citizen or resident alien all year
- You need a valid Social Security number for you, your spouse (for joint returns) and qualifying children
- You must file a tax return
Some eligible taxpayers missing the EITC could be lower earners without a filing requirement, Nassau said. But the EITC is “refundable,” meaning you can still claim a refund even without tax liability.
You can use the IRS’ EITC assistant to see if you qualify.
If eligible, you can file for free using IRS Direct File, IRS Free File, Volunteer Income Tax Assistance (VITA) and others.
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