Today, National Disability Institute (NDI) celebrates Earned Income Tax Credit (EITC) Awareness Day. The Earned Income Tax Credit (EITC) is a pathway out of poverty for millions of American taxpayers.
New for this year: Under the Taxpayer Certainty and Disaster Tax Relief Act of 2020, you may elect to use your 2019 earned income to figure your 2020 EITC if your 2019 earned income is more than your 2020 earned income. For details, read IRS Publication 596, Earned Income Credit.
Nationwide during 2020, 25 million eligible workers and families received about $62 billion in EITC; the average amount of EITC received nationwide was about $2,461.
EITC is available to low- and moderate-income (LMI) working families and individuals. The credit changes every year and is based on factors such as earnings, number of qualifying children and marital status.
EITC is for workers whose income does not exceed the following limits in 2020:
- $50,954 ($56,844 married filing jointly) with three or more qualifying children
- $47,7440 ($53,330 married filing jointly) with two qualifying children
- $41,756 ($47,646 married filing jointly) with one qualifying child
- $15,820 ($21,710 married filing jointly) with no qualifying children
To claim the EITC, you must meet certain requirements and file a tax return with the IRS, even if you do not owe any tax or are not required to file. You can use the online EITC Assistant, available in English and Spanish, to find out if you are eligible for EITC and estimate the amount of your credit.
The EITC is a financial boost to workers, families and communities. It can give people the financial boost they need to make rent or mortgage payments; buy food, medicine and other essentials; and improve their quality of life. Yet, it’s frequently overlooked; one in five taxpayers who qualify for the credit don’t claim it.
Each year, billions of dollars go unclaimed because individuals do not claim tax credits like the EITC or do not file a tax return. People with disabilities often worry that tax credits like the EITC will endanger their Medicaid eligibility or impact their public benefits. However, filing a tax return and claiming the EITC will not affect eligibility for benefits like SNAP, SSI, Medicaid, cash assistance or public housing. Learn more.
To see if you qualify for the EITC, visit www.IRS.gov/eitc.
Join NDI to help educate others about EITC and be a part of the conversation on social media by using #EITC and #EITCAwarenessDay.