The Earned Income Tax Credit (EITC) is a valuable tax credit that taxpayers normally miss. Last year, the American Rescue Act allowed 18 to 24 years old and imposed no age limit to qualify for the credit. The credit was made completely refundable, which helps low- and moderate-income workers and working families. The amount of credit for workers without qualifying children was also tripled, which helps more than 17 million people.
However, the said changes are now gone as the pandemic enhancements for the EITC are going to expire. The age limit is back to 25 to 64 years old to qualify for EITC. The maximum EITC single filers with no children are back to $560, compared to last year’s pandemic enhancement credit of $1,500.
Yet, the IRS said that 1 in 5 eligible Americans does not claim the EITC. In a statement, IRS Acting Commissioner Doug O’Donnell said, “This is an extremely important tax credit that helps millions of hard-working people every year. But each year, many people miss out on the credit because they don’t know about it or don’t realize they’re eligible.” The IRS held an EITC Awareness each year, this year on January 27.
The IRC launched an EITC Awareness Day on January 27. (Photo: Refundtalk)
According to Yahoo Finance, to meet the eligibility, taxpayers must meet adjusted gross income and credit requirements for the current, previous, and upcoming tax years. You may also be eligible if you are living in a rural living, a grandparent raising a grandchild, are disabled or are Native American. You can also check out the IRS EITC Assistant tool if you are still unsure about your eligibility.
If you are eligible for the EITC, you may also be eligible for free tax-filing services at the Volunteer Income Tax Assistance (VITA). This service provided free tax preparation for people with low- to moderate-income individuals, disabled, senior citizens, or with language barriers.
