Workers may get a larger tax refund this year because of the Earned Income Tax Credit (EITC). But to get it, you must file a tax return and claim it.
Today, January 27, 2023, marks the 17th anniversary of Awareness Day, a nationwide effort to increase awareness about EITC and free tax preparation sites. This year, IRS is promoting EITC and providing information on other refundable tax credits that you may be eligible for. This includes the Child Tax Credit (CTC), the Additional Child Tax Credit (ACTC), the Credit for Other Dependents (ODC) and the American Opportunity Tax Credit (AOTC).
Nationwide, as of December 2022, approximately 31 million taxpayers received over $64 billion in EITC.
If you worked last year and had income of less than $59,187 check out your eligibility for EITC. EITC can mean up to a $6,935 refund when you file a return if you have qualifying children. Workers without a qualifying child could be eligible for a smaller credit up to $560. According to the Internal Revenue Service, the average amount credited for 2022 was $2,043.
The IRS estimates that four out of five workers claim the EITC they earned. This leaves billions of dollars on the table each year. Many people are eligible to file a tax return even if they don't owe any tax to claim the EITC. It's money workers can use for groceries, rent, utilities and other bills.
EITC is complex. It varies by income, family size and your filing status. To be eligible, you must have earned income or certain disability income. This means you must have income from working for someone or working for yourself.
Volunteers – trained by the Internal Revenue Service – ask you the needed questions to find out if you qualify for the EITC and other refundable tax credits. Volunteers at Volunteer Income Tax Assistance (VITA) sites, also prepare and e-file (electronically file) your tax return at no cost to you.