The Earned Income Tax Credit

Who Is Eligible, and for How Much?

In the 2023 tax year, 23 million working families and individuals in every state received the EITC.

When filing taxes for 2025 (due in April 2026), working families with children that have annual incomes below about $50,434 to $68,675 (depending on marital status and number of dependent children) may be eligible for the federal EITC. During the 2022 tax year, the average EITC was $3,338 for a family with children.

Unmarried working adults who aren’t raising children in their homes and had incomes below $19,104 (or a married couple without children with a combined income below $26,214) can receive a small EITC for the 2025 tax year. For example, during tax year 2022, the average EITC for a filer without children was just $383.

The EITC amount depends on a recipient’s income, marital status, and number of children. As the chart below shows, workers receive the credit beginning with their first dollar of earned income; the amount of the credit rises with earned income until it reaches a maximum level and then phases out at higher income levels. (See Tables 1 and 2.) The EITC is “refundable,” meaning that if the value of the credit exceeds the amount of federal income tax a low-paid worker owes, the worker receives the difference in the form of a refund when they file their taxes.

EITC Reduces Poverty

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Census data show that in 2024 the EITC lifted about 4.4 million people above the poverty line, including 2.3 million children, based on the Supplemental Poverty Measure (SPM). The number of children living below the poverty line would have been over 20 percent higher without the EITC. The credit reduced the severity of poverty for another 16.6 million people, including about 6 million children, based on the SPM.

The EITC and Child Tax Credit together lifted 8.2 million people above the SPM poverty line and made poverty less severe for 17.5 million others in 2024. (See the chart below.) The EITC reduces poverty by supplementing the earnings of workers paid low wages.

Many studies of the EITC and similar tax credits find evidence linking additional income from the credits to improved health and educational outcomes during childhood, and increased educational attainment, employment, and earnings in young adulthood.

Fixing the Meager EITC for Workers Not Raising Children

For tax year 2021, the American Rescue Plan Act temporarily expanded the EITC for workers without children, providing income support to people who do important work for low pay. The Rescue Plan raised the maximum credit amount from roughly $540 to roughly $1,500, and raised the income cap for these adults to qualify from about $16,000 to at least $21,000 ($27,000 for married couples). It also expanded the age range of eligible working adults without children to include younger adults ages 19-24 (excluding students under 24 who are attending school at least part time), and people 65 and older. Under the Rescue Plan, the expansion of the EITC for workers not raising children was only in effect for tax year 2021.

After the expansion expired, the EITC for workers not raising children returned to an extremely small credit amount — too small even to fully offset federal income and payroll taxes for workers at the federal poverty line. Under current law for tax year 2025, a single adult without children or a non-custodial parent working full time, year-round at the federal minimum wage will be eligible for a meager EITC — $308. (Such an individual would receive a much larger EITC — near the maximum — if they had two children.) Low-paid workers not raising children are the sole group the federal tax system taxes into, or deeper into, poverty, mainly because their EITC is so low. Under current law, we estimate that roughly 6 million working adults aged 19 and older without children will be taxed into, or deeper into, poverty in 2026.

If the Rescue Plan’s temporary changes had been made permanent, the EITC expansion would benefit 14.5 million working adults for tax year 2026, we estimate using Census data. This permanent expansion would have included 8.2 million white, 2.6 million Latine, 2.4 million Black, 666,000 Asian, and 317,000 American Indian or Alaska Native adults. The expansion would have made an estimated 3.8 million adults aged 19 to 24 and 1.6 million people aged 65 and older newly eligible for the credit for 2026, providing an income boost to younger workers trying to gain a foothold in the labor market as well as low-income seniors still in the workforce.

Credit Grows With Earnings, Then Phases Out at Higher Income Levels

Working households qualify for an EITC based on their earnings. Beginning with the first dollar of earnings, a low-income household’s EITC increases (or “phases in”) as their earnings increase, until the credit reaches its maximum amount. The rate at which the EITC phases in depends on marital status and number of children; for example, the phase-in rate for a married couple with two children is 40 percent, meaning their EITC rises by 40 cents for each dollar they earn up to a certain level. Similarly, the EITC for households at higher income levels phases out at a set rate until reaching zero.