Are you eligible for an earned income tax credit?
If you weren't last year, that may have changed.
Under new guidelines, more people without children qualify to receive the federal Earned Income Tax Credit (EITC), the federal government's largest refundable tax credit for low- to moderate-income families, according to the Internal Revenue Service.
The tax claim could help taxpayers get an even bigger return, but according to the Illinois Department of Revenue, many Illinois residents are missing out.
Feeling out of the loop? We'll catch you up on the Chicago news you need to know. Sign up for the weekly Chicago Catch-Up newsletter here.
The EITC and its Illinois counterpart, the Illinois Earned Income Credit (EIC), could bring bigger returns for eligible filers. But you'll need to claim it on your tax return in order to see the benefits.
In a change from past years, the federal credit is now available to more younger workers and senior citizens without children. To qualify, workers must be at least 19 years old and older than 64, according to the IRS. Previously, the credit for those with no dependents was only available for people age 25 to 64.
Recipients also may qualify for a larger credit if their earned income in 2019, prior to the pandemic, was higher than their income in 2021.
Local
The IDOR says residents who don't owe any taxes may still be eligible for the credit.
"A family's eligibility can change year to year, so we continue to urge all working taxpayers to check their eligibility status and be sure to claim both the state and federal credits to maximize savings,” David Harris, director of the IDOR, said in a statement.
The refundable credit is worth up to 18% of federal claims, for those who are eligible.
In 2021, more than 74,800 Illinoisans claimed the federal credit, but failed to claim the state's version. The number, however, was a significant jump from the year before when around 13,000 Illinois residents claimed the federal credit and not the state's version.
According to state revenue officials, $29.8 million was left unclaimed in 2021 alone.
To be eligible, taxpayers have to meet income and residency qualifications and file a tax return, even if they don't owe taxes or are not required to file. Illinois residents must be eligible for federal earned income tax credit in order to receive the state credit.
According to the IDOR, the earned income tax credit can mean up to a $6,728 refund when a taxpayer files a return with qualifying children. Workers without a qualifying child could be eligible for a smaller credit up to $1,502. According to the IRS, the average amount credited for 2020 was $2,411.
To find out if your family qualifies for the credit, click here.
