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Earned Income Tax Credit
 

The Earned Income Tax Credit or EITC is a credit for people who do not earn high incomes. EITC can reduce your taxes and result in a refund. In simple terms, workers keep more of what they earn.

If you are one of the many low-income workers who will not file this year because you do not owe, think again. The IRS may owe you!

Many people with disabilities are eligible to receive the EITC refund, but dont know it. If you worked in 2011 and you qualify for the EITC, you may be eligible to get back some or all of the income tax that was withheld during the year and you may also get extra cash from the IRS. You must file your Federal tax return to claim EITC.

 

EITC is One of the Largest Antipoverty Programs:
 
  • Approximately 24 million claimed over $49 billion for tax year 2008
     
  • Participation is estimated at 75% to 80%
     
  • Five million people, half of them children, lifted out of poverty each year due to EITC
     
  • The cost of administering EITC program ratio to claims paid is less than one percent
     
EITC Myths

1. I have to be married or have children to be eligible. False

2. I have to owe taxes to be eligible. False

3. I do not have to file to get my tax refund. False

4. The EITC refund will impact my other public benefits. False

5. I have to be employed by someone else (I cannot be self-employed). False

6. I can’t get my tax refund money back fast if I go to a free VITA site. False

Federal EITC

*These figures are based on 2010 levels and change every year.
 
Number of Qualifying Children
Earned Income and Adjusted Gross Income (AGI) less than:

May Be Eligible for up to:
3 or more
$45,060 ($50,270 married filing jointly)

$5,891
2
$41,952 ($47,162 married filing jointly)

$5,236
1
$36,920 ($42,130 married filing jointly)

$3,169
0

$13,980 ($19,190 married filing jointly)
$475
Investment income must be $3,200 or less for the year.

Use the IRS EITC Assistant to check to see if you are eligible for the EITC: http://www.irs.gov/individuals/article/0,,id=130102,00.html
 
 
Workers with Disabilities and EITC

It is important to know that Federal and State EITC payments are not considered as income for several public benefits, including Medicaid, SSI, SSDI, Food Stamps, or federally assisted housing programs. That means that you will not see a change in your monthly benefit that month because you received EITC money.

We know that you are also concerned about assets and resource limits.

  • SSI and SSI-Medicaid - EITC payments are excluded from the resource test for nine months following the month the refund is received.
  • SSDI - there is no asset limit.
  • State Medicaid – This can vary by State so please check with your local Medicaid office.
  • Food Stamps – EITC payments are excluded from the resource test.
  • Federally assisted housing – interest accrued on your EITC payments may count as income.
  • Cash assistance programs – These can vary so please check with your local office.
 

Hold on to your tax return to show your caseworker the amount of your EITC refund. They will need to identify the funds to exclude it as a resource.

 
What You Can Do

File your taxes! The EITC is a refundable credit. Even if you do not owe the IRS money, they may owe you. You must file a return with the IRS to claim your Earned income Tax Credit.

Volunteer Information Tax Sites (VITA) are available across the country to help you file your return free of charge, check to see if you are eligible for the EITC and other tax credits and to help you claim the money to which you are entitled. To locate the nearest VITA site, call 1-800-829-1040.

 
Ask if you qualify for other available tax credits:
 
  • State EITC (not available in all States)
  • Federal Child Tax Credit and Additional Child Tax Credit
  • Federal Child and Dependent Care Credit
  • State Child and Dependent Care Credit (not available in all States)
  • Noncustodial Parent Earned Income Tax Credit (not available in all States)
  • Education Credits (not available in all States)
  • Saver’s Credit
 

National Disability Institute supports VITA sites in reaching out to the disability community.

Complete information on EITC can be found on the IRS website.
 

 
Web Resources
 
 

EITCplatform.org is created by the Aspen Institute with support from the Annie E. Casey Foundation and in partnership with the National Community Tax Coalition. It is powered by CCA Global Partners.

EITC statistics from Brookings Institute

US Tax System Credit and Benefits