The Earned Income Tax Credit is the largest refundable tax credit in the US tax code - worth up to $8,231 for a family with three or more children in 2026. It phases in with earned income, peaks, then phases out as income rises. It is fully refundable, meaning the credit can exceed tax owed and generate a cash refund. Millions of eligible workers fail to claim it every year, particularly self-employed individuals who are unaware it applies to them.
3 or more qualifying children: $8,231
2 qualifying children: $7,316
1 qualifying child: $4,427
No qualifying children: $664 (age 25-64)
Investment income limit: $12,200 - exceeding this disqualifies the credit entirely
To claim the EITC, you must pass four tests: earned income (wages, salaries, tips, net self-employment income - not investment income, pensions, or Social Security); adjusted gross income and filing status within limits; a Social Security number for you, your spouse if MFJ, and each qualifying child; and you cannot be claimed as a dependent on another return or file MFS (unless treated as unmarried under the separated-spouse rule of §32(d)(2)(B)).
Self-employed individuals qualify based on net Schedule C or Schedule F income. Earned income is net earnings from self-employment (within the meaning of §1402(a)) determined with regard to the half-SE-tax deduction under §164(f) (IRC §32(c)(2)(A)(ii)).
The credit phases in at a percentage of earned income, reaches a flat maximum, then phases out. The phase-out thresholds are higher for MFJ filers than for single, head of household, or qualifying widow(er) filers.
A qualifying child for EITC purposes must meet four tests: relationship (child, stepchild, foster child, sibling, or descendant thereof); age (under 19, or under 24 if a full-time student, or any age if permanently disabled); residency (lived with you in the US for more than half the year); and the child cannot have filed a joint return. Unlike the Child Tax Credit, there is no requirement that you provide more than half the child's support - the residency test is what matters.
The childless EITC is limited to ages 25-64. The $664 maximum for 2026 remains modest but is fully refundable. Workers who are self-employed, in low-wage jobs, or transitioning between employment situations should check eligibility annually.