Administration Budget Proposal to Expand the Earned Income Tax Credit (EITC) 

for Workers without Qualifying Children 

Low- and moderate-income workers may be eligible for a refundable EITC. Eligibility for the 

EITC is based on the presence and number of qualifying children in the worker’s household, 

AGI, earned income, investment income, filing status, age, and immigration and work status in 

the United States. For workers with children, this credit is very generous, with a maximum value 

for families with one child of $3,373 in 2016. In contrast, workers without qualifying children 

can receive a maximum credit of $506. 

To be eligible for the EITC for workers without qualifying children, the taxpayer must be at least 

25 years old and less than 65 years old. (In the case of married taxpayers filing jointly, the credit 

may be claimed if at least one spouse is over age 24 and less than age 65.) A taxpayer who may 

be claimed as a dependent or as a qualifying child by another taxpayer, including most college 

students, may not claim the EITC for workers without children. There is no age limitation of the 

EITC for workers with qualifying children. 

The EITC for workers without children is phased in at a rate of 7.65 percent on earnings up to 

$6,610. The credit is phased out at a rate of 7.65 percent on income in excess of $8,270 ($13,820 

for married couples filing jointly). The credit is phased out completely at incomes of $14,880 for 

unmarried taxpayers and $20,430 for married couples filing jointly. In 2017 an estimated 7.5 

million workers on 7.3 million returns will claim nearly $2.2 billion in EITC, for an average 

credit of $298. 

Because the credit is small and phases out at such low incomes, it provides little or no assistance 

to individuals at or near the poverty line. For example, in 2017 a single worker without children 

who earns $12,000 (a wage close to the poverty line), would be estimated to be in the phase-out 

range and eligible for a credit of about $233 and would receive a refund of about $83 after 

subtracting his or her Federal income tax (and would pay nearly $920 in Federal payroll taxes). 

A single individual working full-time at minimum wage would receive about $41 of EITC and 

face income tax liability of about $359 after subtracting his or her EITC. 

A larger EITC for workers without children would promote employment and reduce poverty for 

this group of workers. The current age restrictions prevent young workers and older workers 

from claiming the EITC. As a result, young workers living independently from their families are 

unable to benefit from the antipoverty and work related effects of the EITC just when they are 

establishing the patterns of behavior that may persist throughout their working lives. The EITC, 

by increasing the effective wage, encourages additional work effort in the short run, which may 

in turn affect long run labor force attachment and wages. The current age restriction on older 

workers is inconsistent with recent increases in the full retirement age. As a result, workers age 

65 and 66 with low incomes may lose the benefit of the EITC before retiring and claiming their 

social security benefits. 

The proposal would increase the EITC for workers without qualifying children by doubling the 

phase-in rate and the phase-out rate from 7.65 percent to 15.3 percent, thereby doubling the 

maximum credit in 2017 from an estimated $511 to an estimated $1,022. The beginning of the 

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U.S. Department of the Treasury

Office of Tax Analysis

May 13, 2016
phase-out range would be increased from an estimated $8,360 to $11,500 (from $13,960 to 

$17,100 for joint filers) and be indexed for inflation in subsequent years as under current law. 

Thus, the credit for workers without qualifying children would be phased out completely at an 

estimated $18,180 for single taxpayers and $23,780 for married taxpayers filing jointly. The 

proposal would also allow taxpayers who are at least age 21 and under age 67 to claim the EITC 

for workers without qualifying children, if otherwise eligible. In the case of married taxpayers 

filing jointly, the credit could be claimed if either spouse were at least age 21 and under age 67. 

As under current law, taxpayers who could be claimed as a qualifying child or a dependent 

would not be eligible for the EITC for childless workers. Thus, full-time students who are 

dependent upon their parents would not be allowed to claim the EITC for workers without 

qualifying children, despite meeting the new age requirements, even if their parents did not claim 

a dependent exemption or an EITC on their behalf. 

All current claimants would receive a larger EITC under the proposal than under current law and 

millions more who currently receive no EITC would become eligible. Table 1 shows that in 

2017 about 12.8 million returns and about 13.1 million earners would benefit from this proposal, 

with an average benefit per return of $487. Of these, 5.5 million returns and 5.7 million earners 

would be newly eligible. The newly eligible would receive an average benefit of $511 per 

return. Just over 80 percent of the filers who receive a benefit are unmarried. Table 2 shows the 

distribution of workers who would benefit from this proposal by state. 

The proposal would be effective for taxable years beginning after December 31, 2016. 

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U.S. Department of the Treasury

Office of Tax Analysis

May 13, 2016
Total Returns 12.8 -6,241 -487 5.5 -2,836 -511

Total Earners 13.1 5.7

Total Filers 14.2 5.9

Returns by Marital Status

Joint Returns 1.3 -607 -454 0.4 -126 -351

Two Earners 0.3 -154 -484 0.1 -43 -379

One Earner 1.0 -453 -444 0.2 -83 -338

Unmarried Returns 11.5 -5,634 -491 5.2 -2,709 -522

Note: The proposal would increase the EITC for workers without qualifying children by doubling the phase-in rate and the phase-out rate from 7.65 

percent to 15.3 percent, thereby doubling the maximum credit from an estimated $511 to an estimated $1022. The proposal would also allow 

taxpayers who are at least age 21 and under age 67 to claim the benefit, if otherwise eligible. All current claimants would receive a larger EITC.

Estimated Benefit from Administration Budget Proposal to

 for Returns, Earners and Filers by Marital Status

Tax Year 2017

Number of Returns 

or Individuals 

(millions)

Total Benefit 

($millions)

Number of Returns 

or Individuals 

(millions)

Total Benefit 

($millions)

Return, Earner, 

Filer

All Claimants Benefiting from Proposal New Claimants Benefiting from Proposal

Average Benefit 

($)

Average Benefit 

($)

Expand the Earned Income Tax Credit (EITC) for Workers Without Qualifying Children

U.S. Department of the Treasury

Office of Tax Analysis

March 24, 2016

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U.S. Department of the Treasury

Office of Tax Analysis

May 13, 2016
Alabama 194 Massachusetts 266 South Dakota 37

Alaska 38 Michigan 459 Tennessee 287

Arizona 230 Minnesota 220 Texas 994

Arkansas 118 Mississippi 125 Utah 99

California 1,495 Missouri 252 Vermont 32

Colorado 202 Montana 51 Virginia 304

Connecticut 140 Nebraska 76 Washington 254

Delaware 35 Nevada 107 West Virginia 81

Florida 994 New Hampshire 58 Wisconsin 246

Georgia 468 New Jersey 343 Wyoming 24

Hawaii 58 New Mexico 90 DC 24

Idaho 64 New York 871 Other Areas 130

Illinois 525 North Carolina 369

Indiana 275 North Dakota 29

Iowa 120 Ohio 502 

Kansas 115 Oklahoma 145 United States 13,100

Kentucky 181 Oregon 159

Louisiana 185 Pennsylvania 554

Maine 62 Rhode Island 46

Maryland 206 South Carolina 196

Expand the EITC for Workers without Qualifying Children 

(2017 Income and Law)

State

Number 

(Thousands of 

Workers 

Benefiting)

Number 

(Thousands of 

Workers 

Benefiting)

Number 

(Thousands of 

Workers 

Benefiting)

State State

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U.S. Department of the Treasury

Office of Tax Analysis

May 13, 2016