EITC Eligibility Rules — Who Qualifies for the Earned Income Credit?

About 1 in 5 eligible workers fail to claim the EITC — often because they assume they don't qualify. The eligibility rules look complicated on paper, but most working families pass them easily. Walk through each test below.

Check instantly with the EITC Calculator.

---

The 7 Eligibility Tests

Fail any single test and you're disqualified. Pass them all and you qualify — the IRS determines the credit amount based on your income and number of qualifying children.

---

Test 1: Earned Income

The EITC exists to reward work. You must have at least $1 of earned income. What counts:

Earned income (qualifies):

• Wages, salaries, tips (W-2)
• Self-employment net income (Schedule C)
• Gig work (DoorDash, Uber, Etsy)
• Union strike benefits
• Long-term disability payments (before minimum retirement age)

Not earned income (doesn't qualify):

• Social Security benefits
• Unemployment compensation
• Pensions and annuities
• Interest and dividends
• Child support or alimony received
• Rental income

You can have both earned and unearned income. Only the earned income determines your EITC amount, but total AGI must stay under the limit.

---

Test 2: Income Limits

Your adjusted gross income (AGI) and earned income must both be below the threshold:

If either your AGI or earned income exceeds the limit, you're out. Both numbers must be under.

---

Test 3: Filing Status

You can claim EITC with:

• Single
• Head of Household
• Married Filing Jointly
• Qualifying Surviving Spouse

You cannot claim EITC if you file Married Filing Separately. This is a hard rule with one narrow exception: if you lived apart from your spouse for the last 6 months of the year AND you have a qualifying child living with you, some states allow it, but the federal EITC still requires MFJ or another status.

If you're legally married but separated, consider whether filing Head of Household is an option (requires living apart for the last 6 months + paying more than half of household costs).

---

Test 5: Investment Income — The Hidden Trap

Investment income over $11,600 kills your EITC entirely. This includes:

Real scenario: A single mom earns $35,000 at her job and qualifies for ~$4,000 EITC with 2 kids. She also inherited stocks and received $12,000 in dividends. Investment income exceeds $11,600 → EITC drops to $0.

If you're close to the $11,600 limit, consider timing investment sales or shifting to growth stocks (no dividends) to stay under.

---

Qualifying Child Rules

If you're claiming EITC with children, each qualifying child must meet:

• Age: Under 19 (under 24 if full-time student; any age if permanently and totally disabled)
• Relationship: Son, daughter, stepchild, foster child, sibling, half-sibling, or a descendant of any of these
• Residency: Lived with you in the U.S. for more than half the year
• Joint return: Doesn't file a joint return with a spouse (exception: only filed to claim a refund)
• SSN: Has a valid Social Security number

Can two people claim the same child? No. If two eligible people can claim the same child (e.g., a parent and grandparent living together), tiebreaker rules apply: parent wins over non-parent; if both are parents, the one the child lived with longer wins; if equal, higher AGI wins.

---

Frequently Missed Groups

People who qualify but often don't claim:

• Self-employed workers — Freelancers, gig workers, and contractors. Your Schedule C net income counts.
• Workers without children — The credit is smaller ($632 max) but still free money.
• Grandparents raising grandchildren — Grandchildren living with you count as qualifying children.
• Military families — Combat pay can be included or excluded from earned income — choose whichever gives you a bigger EITC.

See your combined benefits with the Federal Tax Calculator.