Summary: For 2026 the EITC maxes out at $8,231 (3+ children), $7,316 (two), $4,427 (one), and $664 (none), phasing in at 34 to 45 percent of earnings for families with children, then phasing out above $23,890 for most filers ($31,160 joint). The IRS uses the greater of earned income or AGI for the phase-out, and investment income above $12,200 disqualifies you.
The 2026 EITC figures below come from IRS Revenue Procedure 2025-32, the annual inflation adjustment. They apply to income earned in 2026, claimed on the return you file in 2027. The credit phases in as earnings rise, holds at a maximum on a plateau, then phases out. These worked examples show how the math actually plays out.
Maximum credits: $664 with no children, $4,427 with one child, $7,316 with two children, $8,231 with three or more. The maximum is reached at $8,680 of earned income (no children), $13,020 (one child), or $18,290 (two or more). Phase-out begins at $23,890 for most filers with children, $31,160 for married couples filing jointly, and the credit is fully gone at $51,593, $58,629, and $62,974 respectively, roughly $7,270 higher for joint filers. Phase-in rates are 7.65 percent, 34 percent, 40 percent, and 45 percent; phase-out rates are 7.65 percent, 15.98 percent, 21.06 percent, and 21.06 percent.
Dana is above the $23,890 phase-out start, so she is in the phase-out band. Her credit is $7,316 minus 21.06 percent of the $1,110 over the threshold, which is $7,316 minus $234, or about $7,082. Close to the maximum, but already shrinking.
Their phase-out begins at $31,160. They are $8,840 over, so the credit is $4,427 minus 15.98 percent of $8,840, which is $4,427 minus $1,413, or about $3,014.
Jordan is on the plateau: $9,000 is between the $8,680 maximum point and the $10,860 phase-out start, so the credit is the full $664.
Priya is deep in the phase-out band: $60,000 minus $23,890 is $36,110 over, times 21.06 percent is $7,605 of reduction from $8,231, leaving about $626. At $65,000 the reduction exceeds the maximum and the credit is $0.
The IRS phases the credit out based on whichever is greater: your earned income or your adjusted gross income. If a year end bonus or overtime pushes your AGI above your wages, the higher number is what counts. That is why two workers with identical paychecks can get different credits.
Because the phase-out is gradual, extra income late in the year, bonuses, extra shifts, or a second job, can move you from the plateau into the phase-out band and trim the credit. It never makes you worse off overall, you keep most of each extra dollar, but it does change the refund you should expect.
Essentially yes. The completed phase-out amounts are the income levels where the credit reaches zero. At $1 over, the formula produces zero or less, which floors at zero. Staying just under keeps a small credit.
No. The credit itself is not taxable income, and it does not count as earned income for next year's calculation.
EITC refunds are not counted when determining eligibility for federal or federally funded benefit programs such as Medicaid, SSI, SNAP, or TANF. A saved refund is also disregarded as a resource for 12 months under federal rules, though state rules can differ, so check your state's policy.
Use the figures for the tax year printed on the return, not the year you file. Income earned in 2026 goes on the 2026 return filed in 2027, using the 2026 parameters in this guide.
Figures: 2026 (IRS Revenue Procedure 2025-32). Source: Internal Revenue Service (irs.gov). This guide is for planning only and is not tax advice. Verify with IRS Publication 596 or a tax professional.