Understanding Tax Credits

The Earned Income Tax Credit (EITC) is a tax credit for people who have earned a low to moderate income. EITC is the #1 antipoverty program in the U.S. As of December 2020, approximately 25 million eligible workers and families nationwide received roughly $62 billion back from the EITC.

Eligible tax filers can receive up to $7,830 depending on income and family size.

For the 2023 tax year, to qualify for the EITC, you must:

• File a federal income tax return
• Have earned income under $66,819
• Have investment income below $11,000
• Have a valid Social Security number by the due date of your 2024 return (including extensions)
• Be a U.S. citizen or a resident alien all year
• Meet certain rules if you are separated from your spouse and not filing a joint tax return
• If you are single without any dependents, you must be at least 25 years old, but under 65 as of December 31

Ineligible for the EITC:

• Form 2555, Foreign Earned Income
• Individual taxpayer identification numbers (ITIN)
• Adoption taxpayer identification numbers (ATIN)
• Social Security numbers on Social Security cards that have the words, “Not Valid for Employment,” on them

If you’re unsure if you qualify for the EITC, use this IRS screener tool.

NOTE: The EITC has special qualifying rules for Military members, Clergy members, Taxpayers and their relatives with disabilities.

For the 2024 tax year, to qualify for the EITC, you can use one of the following statuses:

• Married filing jointly
• Head of household
• Qualifying surviving spouse
• Single
• Married filing separate if you had a qualifying child who lived with you for more than half of 2024, and either of the following apply. You lived apart from your spouse for the last 6 months of 2024, or you are legally separated according to your state law under a written separation agreement or a decree of separate maintenance and you didn’t live in the same household as your spouse at the end of 2024.

Like the federal Earned Income Tax Credit, the Working Families Tax Credit (WFTC) is a tax credit, but available exclusively to Washingtonians — including Individual Tax Identification Number (ITIN) holders.

Eligible tax filers can receive up to $1,290 depending on their income and family size.

You must file a state tax return and:

• Have earned income ($1-$66,819)
• File with a valid SSN or ITIN
• Lived in Washington for at least 183 days
• Between 26 and 65 years old or have a qualifying child
• You cannot be: 
  • Be claimed as a qualifying child of another taxpayer
  • Be claimed as a dependent of another person unless you have a qualifying child

What else you should know:

• You may go back up to three years to claim the WFTC by filing an application.
• You do not have to have a child to qualify for the WFTC, unless you are under younger than 25 or older than 65 years old.

The Child Tax Credit (CTC) is a tax benefit granted for parents of qualifying children. Many changes to the child tax credit (CTC) for 2021 implemented by the American Rescue Plan Act of 2021, have expired. For the 2024 tax year, the Child Tax Credit is up to $2,000 per qualifying child. The exact amount a family receives is based on income and the number of qualifying children you claim on your tax return. The CTC is generally a nonrefundable credit; however, certain taxpayers may be entitled to a partial refund of the credit (limited to $1,700 per qualifying child) through the Additional Child Tax Credit (ACTC).

To qualify, you must:

• Have a qualifying child who was under 17 at the end of 2024 with a Social Security Number valid for employment, and who provided no more than half of their own financial support and lived with the tax filer claiming the credit for more than half the tax year
• Have taxable income of $400,000 or less if you are married and filing a joint return OR
• Have taxable income of $200,000 or less for all other filing statuses

What else you should know:

• Only one person can claim a child. We encourage people to have conversations with family members before it’s time to file. 
• Even if you aren’t required to file taxes, you can still receive your Child Tax Credit benefits.
• Parents who are ITIN holders can claim the federal Child Tax Credit (CTC) until 2025, if they have a qualifying child with a valid SSN.