The IRS has issued frequently asked questions (FAQs) for the 2021 Earned Income Tax Credit (EITC) to educate eligible taxpayers on how to properly claim the EITC when they prepare their 2021 tax returns. The EITC helps low-to-moderate-income workers and families as a credit to either reduce the taxes owed or an added payment to increase a tax refund. The amount of the EITC may change if the taxpayers have children, dependents, are disabled, or meet other criteria. The FAQs provide several details regarding the EITC. The new FAQs are:

  • What Is the Earned Income Tax Credit?
  • What is earned income?
  • What are the earned income limits for taxpayers without qualifying children?
  • How old must I be to claim the Earned Income Tax Credit if I do not have qualifying children?
  • Do I need to have a Social Security number (SSN) to be eligible to claim the Earned Income Tax Credit?
  • Do my qualifying children need to have SSNs in order for me to claim the Earned Income Tax Credit?
  • What are the age requirements for claiming the Earned Income Tax Credit if I have a qualifying child?
  • What are the earned income limits for individuals with a qualifying child?
  • Will any refund that I receive because I claimed the Earned Income Tax Credit affect my government benefits?
  • What is the maximum amount of the Earned Income Tax Credit for 2021 for eligible taxpayers without qualifying children?
  • Is there a limit on the amount of investment income I can earn and remain eligible for the Earned Income Tax Credit?
  • If I am not filing a joint return with my spouse, can I claim the Earned Income Tax Credit?
  • Who is considered a qualified homeless youth for purposes of the Earned Income Tax Credit?
  • Who is considered a qualified former foster youth for purposes of the Earned Income Tax Credit?
  • Can I elect to use my 2019 earned income to figure my Earned Income Tax Credit for 2021?
  • Can a student claim the Earned Income Tax Credit for 2021?
  • What is a specified student for purposes of the Earned Income Tax Credit?

Additionally, the IRS reminded taxpayers with income of $73,000 or less that they can file their tax returns electronically for free through IRS Free File. The fastest way to receive a tax refund is to file electronically and have it direct deposited into a financial account. Refunds can be directly deposited into bank accounts, prepaid debit cards, or mobile apps if a routing and account number is provided.