The federal Earned Income Tax Credit (EITC) is a refundable tax credit for low to moderate-income wage earners, but many eligible taxpayers are unaware of it or miss out on claiming it. The IRS reports that roughly one in five eligible taxpayers are not claiming the credit, leaving billions of dollars unclaimed. The article outlines the eligibility requirements for the EITC, the maximum credit amounts for different situations, and the timeframe for receiving refunds.
The federal Earned Income Tax Credit is designed for low to moderate-income wage earners and is fully refundable, meaning even those who do not earn enough money to have taxes withheld are eligible.The federal Earned Income Tax Credit is designed for low to moderate-income wage earners and is fully refundable, meaning even those who do not earn enough money to have taxes withheld are eligible.
The credit is often overlooked, the IRS said, with roughly one in five eligible taxpayers missing out on claiming the credit. As of December 2024, some 23 million workers and families had received about $64 billion in total from EITC, with the average eligible taxpayer receiving $2,743 from the credit in tax year 2023.Filers must also be U.S.
There are special rules for military personnel, clergy and ministers and taxpayers with certain types of disability income or a child who is disabled. Eligible workers between the ages of 25 and 64 who have no dependents can receive up to $632 by claiming the EITC, while married but separated spouses who do not file a joint return may qualify if they meet certain requirements.
Those with qualifying children can receive a maximum of $7,830 when claiming the EITC for tax year 2024, up from $7,430 in tax year 2023.Most taxpayers who file electronically with direct deposit will receive their refund within 21 days of submitting their return. Filers claiming EITC and the Additional Child Tax Credit will wait longer, however, due to a federal law that requires additional checks related to identity theft.
EARNED INCOME TAX CREDIT TAX REFUNDS IRS ELIGIBILITY CRITERIA TAX POLICY
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