Every January, millions of Americans file their taxes and hand the IRS more money than they actually owe.
Not because they did anything wrong, but because they never claimed a credit designed specifically for them.
It's called the Earned Income Tax Credit, and the IRS estimates that roughly one in five eligible workers leaves it on the table each year.
For the 2023 tax year, that meant an average of about $2,500 per qualifying household that simply vanished into the federal budget instead of landing in a family's bank account.
The math is blunt: if you worked last year and earned under certain income limits, there's a real chance you qualify.
For the 2024 tax year, single filers with no children can claim the credit with income up to $18,591.
A married couple with three or more kids can earn as much as $66,819 and still qualify.
In between, the credit scales with both income and family size, and it's refundable — meaning if it exceeds what you owe, the IRS sends you the difference as a check.
Part of the problem is who tends to miss out.
The Government Accountability Office has found that workers without children, older adults, rural residents, and people with limited English proficiency are the most likely to skip the credit.
Some assume they make too little to file a return at all, which is exactly backwards — filing is often the only way to get the money.
Others worry that claiming it will trigger an audit or jeopardize a benefit, neither of which is how the program actually works.
You need your Social Security number, your W-2s or 1099s, and proof of any qualifying children you're claiming.
If you're a gig worker or drive for a delivery app, your income still counts, and you can use a Schedule C to report it.
Free tax preparation through the IRS's Volunteer Income Tax Assistance program is available to households earning roughly $67,000 or less, and many software providers offer free filing at similar income levels.
The IRS typically can't issue refunds that include the EITC until mid-February, so an early-filed return with the credit won't show up in your account as fast as a plain refund.
That delay is worth planning for if you're counting on the money for rent, car repairs, or debt payoff.
The credit has been expanded repeatedly over the years, most recently through a temporary boost for childless workers that expired after 2021, so check current-year rules before assuming you're ineligible.
Prior-year returns can sometimes be amended going back three years if you missed the credit — worth checking if you suspect you've been leaving money behind.
One final note: any tax preparer who promises a specific refund amount before seeing your documents is guessing.
The EITC depends on your actual income, filing status, and dependents, and no honest preparer can promise a number up front.
If you worked for wages in 2024, this is one of the rare government programs where the only requirement is that you ask.
Checking takes about ten minutes on the IRS website.
Final Thoughts
Not checking could cost you more than most people spend on groceries in a month.