Earned Income Tax Credit (EITC)
TaxGlossary term
Definition
A refundable federal tax credit for low- to moderate-income working individuals and families. The credit amount depends on income, filing status, and number of qualifying children, and can result in a refund even if no taxes are owed.
Related terms
- Tax CreditA dollar-for-dollar reduction in taxes owed. More valuable than deductions, which only reduce taxable income. Examples include Child Tax Credit and Earned Income Tax Credit.
- Child Tax CreditA federal tax credit that reduces taxes owed for each qualifying child under age 17. The credit directly lowers your tax bill dollar-for-dollar and may be partially refundable if it exceeds the taxes you owe.
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