EITC
Business & Finance abbreviation · Tax
| Stands for | Earned Income Tax Credit |
|---|---|
| Categories | Business & Finance |
EITC stands for Earned Income Tax Credit, a tax abbreviation also used in government.
Refundable federal credit for low- and moderate-income workers, worth most to families with qualifying children, that can produce a refund even when no income tax is owed. Eligibility depends on earned income, AGI, investment income and the number of qualifying children, up to three.
Example: With two kids and a part-time income, her EITC was larger than all the tax she paid during the year.
Usage notes
Enacted in 1975 and expanded several times, it is one of the largest US anti-poverty programs; tax forms label it EIC. By law, refunds that include the EITC cannot be issued before mid-February, a fraud-prevention rule from the 2015 PATH Act. Most states add their own earned income credit. The IRS estimates that roughly one in five eligible workers do not claim it.
Related abbreviations
More tax abbreviations
- CRS – Common Reporting Standard
- CTC – Child Tax Credit
- DAF – Donor-advised fund
- EA – Enrolled Agent
- EFTPS – Electronic Federal Tax Payment System
- EIN – Employer Identification Number
- ETR – Effective tax rate
- FATCA – Foreign Account Tax Compliance Act
- FBAR – Report of Foreign Bank and Financial Accounts (FinCEN Form 114)
- FEIE – Foreign earned income exclusion
- FICA – Federal Insurance Contributions Act tax
- FIT – Federal income tax