Earned Income Tax Credit

The Earned Income Tax Credit, EITC or EIC, is a benefit for working people with low to moderate income. To qualify, you must meet certain requirements and file a tax return, even if you do not owe any tax or are not required to file. EITC reduces the amount of tax you owe and may give you a refund.

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For many of our clients, the Earned Income Tax Credit (EITC) is an important credit offering tax discounts and refunds to working families and individuals. The EITC anti-poverty initiative created by the Federal government helps to bring financial stability via significant tax credit resulting in refunds. For example, a refund for a family with 3 children and a maximum income of $48,362 can get a maximum federal refund of $5,666, while a single individual with an income of $13,460 can get a maximum refund of $457. To help with tax filing, Volunteer Income Tax Assistance Sites (VITA) are set up all throughout Long Island. Find the closest site by going to the link listed below or check out your local library. Remember, the EITC can be claimed on both Federal and New York State tax returns.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (P.L. 111-312) was signed into law on December 17, 2010. The law includes a provision that disregards tax refunds received after December 31, 2009, as income and as resources (for a period of 12 months) in programs funded in whole or in part with federal funds, including those operated by States, localities, or others. The law is not retroactive, but applies as of the date of enactment and, thus, States, Tribes, and Territories must move expeditiously to implement the provision.

This means that your tax refunds, including the EITC, will not count against public assistance, Medicaid, Food Stamps, SSI, or Section 8 for 12 months.

Earned Income and adjusted gross income (AGI) must each be less than:

  • $43,352 ($48,362 married filing jointly) with three or more qualifying children

  • $40,363 ($45,373 married filing jointly) with two qualifying children

  • $35,535 ($40,545 married filing jointly) with one qualifying child

  • $13,460 ($18,470 married filing jointly) with no qualifying children

Tax Year 2010 maximum credit:

  • $5,666 with three or more qualifying children

  • $5,036 with two qualifying children

  • $3,050 with one qualifying child

  • $457 with no qualifying children

The American Recovery and Reinvestment Act (ARRA) provides a temporary increase in EITC and expands the credit for workers with three or more qualifying children. These changes are temporary and apply to 2009 and 2010 tax years.

For more information on whether a child qualifies you for the EITC, see Publication 596, Chapter 2, Rules If You Have a Qualifying Child.

Investment income must be $3,100 or less for the year.

The maximum Advance EITC workers could receive from their employers was $1,830. If a worker received Advance EITC during the year, the worker must file a tax return to report the payments. Important Note: The Education Jobs and Medicaid Assistance Act of 2010 signed into law August 10, 2010 repealed the Advance EITC. It will not be available to workers after December 31, 2010.


  1. Free Tax Return Preparation for Qualifying Taxpayers

  2. Information on New York’s Earned Income Tax Credit

  3. Information on the Federal Earned Income Tax Credit

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