Glossary
Earned income credit
Also called EIC, EITC
Definition
The earned income credit (EITC) is a refundable federal credit for low- and moderate-income workers, based on earned income, AGI, filing status and qualifying children. It phases in, plateaus and phases out; investment income above $12,2002026 · IRS Rev. Proc. 2025-32 disqualifies it.
How earned income credit works
Paid preparers must complete due-diligence requirements for EITC claims. Refunds claiming the credit are held until mid-February by law.
Workers without qualifying children can claim a small credit if they meet age rules.
Why it matters to a firm
EITC households need accurate preparation and often return year after year.
| 2026 figure | Source |
|---|---|
| Earned Income Credit investment-income limit: $12,200 | IRS Rev. Proc. 2025-32 |
Calculators that use earned income credit
Questions about earned income credit
Is the EITC refundable?
Yes.
Why are EITC refunds delayed?
By law, until mid-February.
What disqualifies me?
Among other rules, investment income above $12,2002026 · IRS Rev. Proc. 2025-32.
No question matches that filter. Clear it to see them all, search the whole site, or ask us directly; we reply within one business day.
Related terms: Adjusted gross income
Next entry
Put the definition next to the number
Calculators on your site explain their own terms, in English or Spanish, before the client ever calls.
Firm and Network plans include a 14-day trial. Cancel before it ends and you pay nothing.