Millions of Americans Missing Out on Valuable EITC
Each year, tens of millions of Americans file their tax returns, and many of them are missing out on a valuable credit, the earned income tax credit (EITC), according to the IRS. In 2022, around 23 million filers received $57 billion through the EITC, designed for low- to moderate-income workers. However, nearly one in five eligible taxpayers fail to claim it, even though it averaged $2,541 in 2022.
For the 2023 tax year, the EITC can be worth up to $7,430 for families with three or more children, an increase from $6,935 in 2022. To qualify, your income must fall below certain thresholds, and there are eligibility requirements, including having qualifying children.
The EITC is a refundable credit, meaning you can get a refund even if you don't owe taxes. However, it can be complex, with various eligibility criteria. To check your eligibility, you can use the IRS's online tool.
Many eligible taxpayers miss the EITC, leading to improper payments and higher audit rates for EITC claimants. Properly claiming the EITC can significantly benefit eligible individuals and families, so it's advisable to use available resources like Free File, tax professionals, or the IRS's free tax prep programs to ensure you claim the credit you're entitled to.
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WHY IS THIS IMPORTANT FOR MY INDUSTRY?
Here's the deal in our line of work – a lot of us have individuals on the team who might not be rolling in dough. But the earned income tax credit can really help them out, putting some extra cash in their pockets. So, here's the kicker – as the boss, we can step up and make sure our people know about this EITC. We're not just about business; we're about looking out for our team's financial well-being. That can make our folks happier, stick around longer, and save us the hassle and cost of constantly bringing in new hires.
Oh, and let's not forget, our industry deals with some tax rulebook that's thicker than a phonebook. Knowing the ropes around EITC can help everyone navigate those tricky tax waters.
🔥 OUR HOT TAKE?
Getting the hang of this EITC thing can be a game-changer for both us as the bosses and our hardworking team. It's a secret weapon for taxes that can lighten the load for everyone. That means more money where it belongs – in our pockets and our employees'.
And you know what? Helping our crew grab the EITC is all about fairness and looking out for each other.. When our team catches a break with the EITC, it takes some weight off their shoulders, and that can mean they're more locked in at work. It's a win-win.
The U.S. Treasury Department recently updated the rules for electric vehicle (EV) tax credits under the 2022 Inflation Reduction Act, stirring up a bit of a storm.