Earned Income Tax Credit (EITC)
Definition
A refundable tax credit for low-to-moderate-income working individuals and families. The credit amount depends on your income, filing status, and number of qualifying children. For 2025, the maximum EITC ranges from $632 (no children) to $7,830 (three or more children). Because it's refundable, you can receive it even if you owe no tax.
Example
A single parent with two children earning $25,000 might qualify for an EITC of approximately $6,604, significantly reducing their tax burden or increasing their refund.