The Earned Income Tax Credit, or EITC, is one of the biggest tax credits you can get, but many eligible taxpayers – including single moms – don’t claim it.
People have a lot of mistaken ideas about this highly beneficial tax credit, like it’s only for very poor people (not true) or it’s very hard to claim (also not true). And what you don’t know about the EITC could keep you from having a lot more money.
So here are five things most people don’t know about the EITC.
- Last year, more than 27 million taxpayers got more than $67 million in Earned Income Tax Credits.
- The national average of EITCs received last year was $2,455…and the average was even higher in several states.
- Many – if not most – single moms qualify for the EITC.
- Self-employment income counts toward eligibility, so you may qualify even if you don’t have any W-2 job income.
- This is a refundable tax credit, meaning if your credit comes to more than you owe, you get that extra money back.
With an average $2,455 on the table, it’s absolutely worth it to see if you can benefit from the EITC.
Over the next couple of weeks, we’ll cover everything you need to know about the EITC. In the mean time, if you want to learn more, visit the EITC section on the IRS website.