Biden’s boost to the earned income tax credit may trigger a ‘marriage penalty’

Federal stimulus and enhanced tax credits have provided benefits to millions of Americans. However, some low-income workers may not receive a boost.

The earned income tax credit, known as the EITC or EIC, offers a write-off for low- and moderate-income families. To qualify, taxpayers must have earned income — wages and payments other than investments — and the credit may increase with eligible children. 

Workers may receive a credit based on a percentage of earnings, and it’s refundable, meaning it cuts their tax bill or provides a refund, even if it’s larger than levies owed. The Internal Revenue Service has a tool to see who qualifies.

Previously, workers without children received little support from the EITC. However, the American Rescue Plan boosted the tax break through 2021 and expanded eligibility to cover more taxpayers without kids.