EITC makes up to $7,459 available to low-income, working Mainers — but only if they file their taxes

Maine workers with low incomes could receive thousands of dollars through the Earned Income Tax Credit, or EITC. But that income boost is only available to those who file their taxes, making it crucial that all people and families with low incomes file their return by this year’s extended deadline of May 17.

The EITC is a commonsense tax break for working people with low incomes. It encourages and rewards work by providing eligible filers a credit that gets larger the more they earn. Eligible filers claim the EITC on their federal tax returns. Maine also offers a smaller EITC on state tax returns.

This year, the EITC is stronger than ever: Maine recently more than doubled the size of its own EITC while expanding eligibility to younger workers and those without children. The American Rescue Plan approved earlier this year by Congress ensured workers with low incomes and those that claimed unemployment benefits won’t be punished if they lost work during 2020 as the pandemic spread; It allows workers to claim the EITC based on 2019 income if it would lead to a larger credit.

Together, those improvements increased the total value of money available to Mainers through the EITC to $7,459 — comprised of a $6,660 maximum federal credit and $799 maximum state credit.

The EITC is one of the most effective anti-poverty programs our country has ever created. It helps Mainers put food on the table, pay bills, and cover other basic living expenses. You can use the widget below, created by MECEP policy analyst James Myall, to see the EITC’s impact in Maine or in your county.

According to a Center on Budget and Policy Priorities analysis of IRS data, more than 97,000 Mainers claimed the federal EITC when they filed their taxes in 2019. The credit put more than $203 million in the pockets of households with low incomes. That money helped lift families out of poverty and boosted the local economy. The average EITC for Mainers was worth more than $2,000. The state EITC boosted Maine incomes by an additional $10 million, with an average benefit of about $100 for eligible Mainers. (This year’s Maine EITC will be even larger because a of a law passed in 2019 to more than double the credit.)

If you or someone you know has a household income of less than $57,000, you may be eligible for a larger tax refund because of the EITC. Because the credit is refundable, it can lead to larger refunds – even if the filer has no tax obligation.

While millions of Americans and tens of thousands of Mainers benefited from the EITC, many others left money on the table because they didn’t file their taxes. The IRS estimates that one-fifth of eligible Mainers don’t receive the EITC they earned by working. That leaves tens of millions of dollars unclaimed by low-income workers.

By filing taxes, people and families with low incomes can make sure they aren’t leaving money on the table. CA$H Maine, a coalition of nonprofits throughout the state, offers tax filing assistance to low-income families. If you or someone you know needs help filing your taxes and claiming your EITC, visit https://www.cashmaine.org/free-tax-prep/.