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EARNED INCOME CREDIT (EIC)
Income Eligibility and credit amounts for tax year 2007
Families with 1 child:
Income Cut off = $33,241 (or $35,241 for married workers)
Maximum Federal credit: $2,853
Maximum Maryland refundable credit: $571
TOTAL REFUNDABLE CREDIT (combining state & federal): $3,424
(Maximum Maryland non-refundable credit: $1427)
Families with 2 or more children:
Income Cut off = $37,783 (or $39,783 for married workers)
Maximum Federal credit: $4,716
Maximum Maryland refundable credit: $943
TOTAL REFUNDABLE CREDIT (combining state & federal): $5,659
(Maximum Maryland non-refundable credit: $2358)
Workers between the ages of 25 and 64 with no children:
Income Cut off = $12,590 (or $14,590 for married workers)
Maximum Federal credit: $428
Maximum Maryland refundable credit: 0
TOTAL REFUNDABLE CREDIT (combining state & federal): $428
(Maximum Maryland non-refundable credit: $214)
The numbers above indicate eligibility cut-offs, by family size, and maximum credit amounts. Please use caution in using these numbers with the public. When people hear the income cut-off and the maximum credit amount in the same sentence, they often infer that the credit amount rises as income rises, up to the cut-off. This is not true. The distribution of credit is more like a bell curve. The maximum credit amounts go to families, with more than one child, in the income range of $11,000 to $15,000 and tapers off as income falls or rises from that mid-range. For families with only one child, the maximum credit goes to families with income between $8,000 and $15,000.
In 2007, Advance EIC payments will be available to any worker with at least one qualifying child who expects 2007 income of less than about $33,000 (or $35,000 for married workers).
The official income limits for AP EIC for 2008 won't be announced until November, but based on projected inflation adjustments CBPP uses to model tax effects in future years, this is what we're saying. (Note that the higher income limit differential for married workers jumps to $3,000 in 2008.):
In 2008, Advance EIC payments will be available to any worker with at least one qualifying child who expects 2008 income of less than $34,000 (or $37,000 for married workers).
Child Tax Credit is up to $1,000 per dependent child. The Additional Child Tax Earnings Threshold is $11,750 in 2007.
Updated: 6/26/07
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