Millions of workers, self-employed and farmers can receive refunds if they qualify for the Earned Income Tax Credit (EITC).
Qualifying taxpayers are those who earned $53,505 or less last year. The Internal Revenue Service said that the qualifying head of the family with three or more qualifying children can claim up to $6,269 of maximum credit.
What’s good about EITC is that it is a refundable tax credit, meaning you can take home a refund even if you do not owe taxes. In the past year, over 27 million of taxpayers enjoyed this tax benefit with an average EITC of more than $2,455. The IRS recommends those who qualify for this tax credit to use the EITC Assistant to find out if they qualify for the tax credit and get an estimate of the amount they could claim.
[Related Article: All about Tax Credits for Business and Individual Taxpayers]
The EITC is an important state apparatus to alleviate poverty. According to the IRS commissioner John Koskinen, “The EITC is an important anti-poverty tax credit that helps millions of people every year.” Unfortunately, there are some who are missing this tax benefit noting that even though 4 out of 5 taxpayers benefit from EITC, millions are still missing out thousands of savings.
As a response, the federal tax agency spearheaded the Earned Income Tax Credit Awareness Day on January 27 along with other agencies. The awareness day has been celebrated for 11 years now, in hope that millions more would benefit from this tax credit.
IMPORTANT: A new law requires the IRS to hold the release of some refund claims including EITC until February 15. However, you can still expect faster refund processing if you choose online filing and direct deposit.
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