The Internal Revenue Service (IRS) has increased the maximum amount available under the Earned Income Tax Credit (EITC) for the 2026 tax year.
With inflation-driven updates to tax brackets and eligibility thresholds, this change stands to raise refunds for qualifying low- and moderate-income households.
What’s Changed for 2026
The IRS adjusts certain tax parameters each year to reflect inflation. For the 2026 tax year, these annual adjustments include a higher maximum EITC based on family size and filing status. These changes will apply when taxes are filed in 2027.
Here’s a breakdown of the new maximum credit allowances:
- Families with three or more children can now receive up to $8,231.
- For families with two children, the maximum rises to $7,316, up from $7,152 in 2025.
- Families with one child may claim up to $4,427 (previously $4,328).
- Qualifying adults without children can now get up to $664, up from $649.
Why This Matters
Because the EITC is fully refundable, eligible filers may receive the full credit as a refund—even if they owe no federal income tax. That means this update has the potential to generate larger refunds for many households.
Eligibility & Income Limits
To claim the increased EITC, taxpayers must meet income and investment thresholds, as well as fitting into the correct filing-status category.
Income Limits for Married Filers (Joint Return)
- With three or more children: phases out completely at $70,224.
- With two children: phase-out at $65,899.
- With one child: phase-out at $58,863.
- Without children: phase-out at $26,820.
Income Limits for Single, Head of Household or Widowed Filers
- With three or more children: phase-out at $62,974.
- With two children: phase-out at $58,629.
- With one child: phase-out at $51,593.
- Without children: phase-out at $19,450.
Additionally, for the 2026 tax year, filers must have investment income of $12,200 or less to qualify.
What to Do Now
- Review your household filing status and number of qualifying children to determine your maximum EITC.
- Keep tabs on your adjusted gross income (AGI) and investment income as your tax year progresses.
- Plan ahead for filing in 2027 by gathering documentation early and understanding how these new limits apply to your situation.
- Consult a tax professional or trusted tax-preparation resource if you’re unsure whether you qualify or how these changes will affect your return.
The IRS’s updated EITC for 2026 provides a meaningful increase in potential refunds for many low- and moderate-income families, especially those with children.
By understanding and planning for the revised credit amounts, income phase-out limits, and investment income ceiling, you can position yourself to make the most of this opportunity when filing in 2027.
FAQs
When will I actually receive the updated credit?
The increased EITC applies to tax returns filed in 2027 for the 2026 tax year.
Does having no children exclude me from the EITC entirely?
No — taxpayers without children may still qualify under the adult credit category, though the maximum amount and income limits are lower.
What happens if my investment income exceeds the $12,200 threshold?
If your investment income for the year is above $12,200, you will not qualify for the EITC for tax year 2026.
