Childless workers this year can claim an Earned Income Tax Credit worth up to $1,500 — triple the usual amount.
The IRS has also scrapped prior years' age limits for the EITC. Previously, only workers ages 25 to 64 could claim it. This tax season, any worker 19 or older who meets the income guidelines can qualify for the credit, as well as 18-year-olds who are homeless or who have been in foster care.
"The American Rescue Plan allows anyone 19 and older, who's not a full-time student [and] who has earnings, to claim the expanded EITC. It expanded both age and income eligibility and it made the credit larger," said Kris Cox, deputy director of federal tax policy at the Center on Budget and Policy Priorities, a left-leaning think tank.
Most years, however, workers who don't have children get a small credit. Last year, a single worker had to earn $15,800 or less to qualify for the tax break, and the maximum credit for individuals amounted to only $540. By contrast, a single parent of two earning the same $15,800 would qualify for a $5,800 credit.
"What this meant was people who worked for very low pay who were getting such a meager EITC, and also young working adults and older working adults, were completely excluded" from the EITC's benefits, said Kris Cox, deputy director of federal tax policy at the Center on Budget and Policy Priorities. The lower value of the EITC for childless workers means those people are less likely to claim the credit despite being entitled to it. About two-thirds of eligible childless taxpayers claim the EITC every year, compared with more than 80% of taxpayers with children, according to Cox.
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