CAAB

Investing in People, Strengthening Communities

How Does the EITC Help Families?

The Earned Income Tax Credit (EITC) is a federal tax refund to increase the income of working families by providing tax reductions and cash supplements.

How Does the EITC Help Families?

 

The Earned Income Tax Credit (EITC) is a federal tax refund to increase the income of working families by providing tax reductions and cash supplements.  

 

How does EITC help families?

  • Nationwide, last year, about 27 million taxpayers received more than $65 billion in EITC.
  • EITC has been instrumental in closing the poverty gap for many of the nation’s working families.
  • Children whose families receive refundable tax credits are more likely to attend college and have higher earnings.
  • EITC refunds have been linked to improved infant well-being and health.
  • Children in households that receive the EITC appear healthier, and less likely to develop early disabilities and illnesses linked to child poverty, which may also increase their earning capacity as adults.

What is EITC?

  • EITC is a federal tax refund to increase the income of working families by providing tax reductions and cash supplements.
  • As a federally funded anti-poverty initiative, the primary purpose of EITC is to help people employed at low-wages achieve greater financial stability by offsetting taxes, supplementing wages, and making work more gainful.
  • Refunds received from EITC are not considered income for any federal or federally funded public benefit program, such as:
    • Medicaid
    • Supplemental Security Income
    • Supplemental Nutrition Assistance Program (food stamps)
    • Low-income housing
    • Most cash assistance payments received through state TANF programs

Tax Year 2016 qualification levels

  • Earned Income and adjusted gross income must each be less than:
    • $47,955 ($53,505 married filing jointly) with three or more qualifying children
    • $44,648 ($50,198 married filing jointly) with two qualifying children
    • $39,296 ($44,846 married filing jointly) with one qualifying child
    • $14,880 ($20,430 married filing jointly) with no qualifying children
  • Tax Year 2016 maximum credit:
    • $6,269 with three or more qualifying children
    • $5,572 with two qualifying children
    • $3,373 with one qualifying child
    • $506 with no qualifying children

 

About Capital Area Asset Builders

Capital Area Asset Builders (CAAB) is a non-profit organization whose mission is to empower low- and moderate-income residents of the Greater DC Area to take control of their finances, increase their savings, and build wealth for a better future.

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How to give

Now, more than ever, non-profits like Capital Area Asset Builders (CAAB) need your help. Please support CAAB as we continue to help DC residents manage and/or improve their financial situation during these difficult times. If you can't afford to give a monetary gift, please visit our Amazon Wish List where you can choose from a variety of items that CAAB needs in order to better serve our community.

or send a check or money order to
Capital Area Asset Builders (CAAB)
c/o Joseph Leitmann-Santa Cruz, CEO & Executive Director
1100 H Street NW, Suite 200
Washington, DC 20005