A $7,430 boost to your tax refund: See if you qualify for credit (2024)

WASHINGTON – A tax credit that is intended to provide a tax break to low- and moderate-income taxpayers could boost your refund from the IRS by as much as $7,430.

Yet the credit often is unclaimed by the people for whom it is meant to benefit. For those people, it simply is money left sitting on the table.

Social service advocates for low-and moderate-income households laud the Earned Income Tax Credit because it is an injection of cash into family budgets.

Since the credit is refundable, any left after any tax liability is covered gets added as cash to the taxpayer’s refund. Advocates for the poor note that in addition to helping families, the credit serves as a form of economic stimulus because the money is spent directly in the local economy, often for necessities, such as groceries and household goods.

Related: Get free IRS help preparing tax returns, filing electronically and get refunds faster

Related: Where’s my tax refund? Once you file, how long you’ll wait for your cash

How much you can claim for the EITC depends on your income and the number of dependents in your household. Families with lower incomes or more children often qualify for the largest credits.

For 2023 taxes (filed in 2024), the maximum amounts of credit can range from $600 to $7,430, depending on your individual circ*mstances.

A single person with no children can qualify for up to $600 if their adjusted gross income is no more than $17,640. At the top end of the scale, taxpayers with three or more children who file a joint return can qualify for up to $7,340 so long as the household income is $63,398 or lower.

Others who may qualify for the credit include those who are disabled or meet other criteria. The IRS cautions that military and clergy should review its special rules for the EITC to see if using the credit affects other government benefits.

While the credit is essentially free money to those who qualify, many people who could get the refund boost do not.

A study by the Federal Reserve Bank of Chicago in 2022 estimated that 22% of eligible families in America do not claim the credit. That affects roughly 7.5 million eligible families, researchers estimated.

It is estimated that as much as half of the poorest eligible families do not claim the EITC.

The most common reason that eligible families do not claim the EITC or CTC is that they don’t file a federal income tax return. Researchers estimate two-thirds of eligible families that do not receive the EITC do not file an income tax return.

The Earned Income Tax Credit is one of several geared toward families with children.

Others include the Child Tax Credit and the Credit for Other Dependents, the Child and Dependent Care Credit and Education Credits to defray the cost of higher education

You can learn more about these and other tax credits by visiting the IRS online.