With the start of the 2023 tax season, the Internal Revenue Service (IRS) is calling on taxpayers who earned $59,187 or less last year to take advantage of the Earned Income Tax Credit (EITC).
“This is an extremely important tax credit that helps millions of hard-working people every year,” said Acting IRS Commissioner Doug O’Donnell. “But every year, many people lose credit because they don’t know or realize they’re eligible. In particular, people who experienced a major life change in the past year—in their job, marital status, a new child, or other factors—may qualify for the first time. The IRS urges people to carefully review this important credit; We don’t want people to miss out.”
Workers at risk of ignoring the EITC:
– Those who live in non-traditional homes, such as a grandparent raising a grandchild
– Those whose income decreased or whose marital or parental status changed
– Those who do not have children
– With limited knowledge of English
– Who are veterans
– Live in rural areas
– Workers with earnings below the filing requirement
Who can get the EITC?
To qualify, taxpayers must meet certain requirements and file a tax return, even if they didn’t earn enough money to be required to file a tax return.
– Workers with qualifying children may be eligible for the EITC if their adjusted gross income (AGI) was less than $53,057 in 2022 ($59,187 for married filing jointly). These people can receive a maximum of $6,935 in EITC, up from $6,728 in 2021.
– The maximum EITC for taxpayers without dependents is $560, available to taxpayers with an AGI below $16,480 in 2022 ($22,610 for married filing jointly), and can be claimed by eligible workers between the ages of 25 and 64. Married but separated spouses not filing a joint return may qualify to claim the EITC if they meet certain requirements.
The EITC is for workers whose income does not exceed the following limits in 2022:
– $53,057 ($59,187 married filing jointly) with three or more qualifying children who have valid Social Security numbers (SSNs).
– $49,399 ($55,529 married filing jointly) with two qualifying children who have valid SSNs.
– $43,492 ($49,622 married filing jointly) with one qualifying child who has a valid SSN.
– $16,480 ($22,610 married filing jointly) with no qualifying children with a valid SSN.
– Investment income must be $10,300 or less.
How to claim the EITC
Those eligible for the EITC have these options for filing a tax return and claiming the credit:
– Through the IRS Free File: do your taxes for free
– Free tax preparation sites
– Find a trusted tax professional
The IRS reminds taxpayers to make sure they have valid Social Security numbers for themselves, their spouse if filing jointly, and for each qualifying child claimed for the EITC. SSNs must be issued before the April due date of the return.
Although the IRS began accepting 2022 returns on January 23, 2023, the IRS cannot issue a refund that includes the Earned Income Tax Credit or Additional Child Tax Credit (ACTC) before mid-February.
In 2022, 31 million eligible workers and families across the US received about $64 billion in Earned Income Tax Credits, with the average amount exceeding $2,000.
For more details on the Earned Income Tax Credit (EITC), click here.
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