Earned Income Tax Credit - United Way for Southeastern Michigan

The Earned Income Tax Credit (EITC) provides a tax credit to working people with low to moderate income. Qualifying individuals receive a cash payment (via direct deposit or paper check) after filing their taxes. The IRS starts sending refunds in mid-February. By law, the IRS is not allowed to send EITC refunds during the first few weeks of tax season.

In addition to the EITC credit from the federal government, Michigan now offers an expanded state EITC credit. This means more money in your pocket if you qualify!

To claim your credit, you must file a tax return, even if you do not owe any tax or are not otherwise required to file. If you worked full or part time in 2023, you may qualify for the credit.

Who qualifies?

You must have earned income (from working) in 2023 to qualify. If you have some earned income, you can qualify even if you receive other benefits. The details vary depending on your tax filing status and number of children in your household. All of the adults and children on your tax return must have a Social Security Number for your household to qualify.

Qualifying children can include your biological children, adopted children, grandchildren, younger siblings, and nieces and nephews. To qualify, children must live with you at least half of the year and be under age 19, be under 24 and a full time student, or be permanently disabled.

What’s changed about the Michigan EITC?

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In 2023, changes to Michigan law increased the amount of the Michigan Earned Income Tax Credit for Working Families (also known as the Michigan EITC or the Working Families Tax Credit). The Michigan EITC uses the same eligibility criteria as the federal EITC. The amount of the Michigan credit is calculated as a percentage of the amount the family or individual receives from the federal EITC.

Previously, the Michigan EITC was calculated as 6% of the federal EITC. For example, if a family qualified for a $3000 federal EITC refund, they received an additional $180 ($3000 x 6%) from the state of Michigan when filing their state taxes.

Under the new law, starting with taxes filed in 2023 (for tax year 2022), the Michigan credit was increased to 30% of the federal credit. In the same example, a family qualifying for a $3000 federal EITC refund will now receive an additional $900 ($3000 x 30%) from the state of Michigan.

How do I claim the expanded Michigan EITC this year (tax year 2023)?

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When you file your taxes in 2024 (for the 2023 tax year), the Michigan EITC will be automatically calculated at the new amount and included in your regular refund. You do not need to take any special action, but you do need to file taxes in 2024. We can help! Get expert help filing your taxes at no cost to you.

How do I get my payment for last year’s expanded Michigan EITC (tax year 2022)?

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Because the new legislation was passed during the 2023 tax filing season, Michigan EITC payments for taxes filed in 2023 (for tax year 2022) are a bit unusual.

If you filed taxes in 2023 for the 2022 tax year and qualified for the EITC, you already received the old 6% Michigan EITC. The state of Michigan will issue refunds in early 2024 for an additional 24% of the federal credit amount (the difference between the 6% credit already received and the 30% new credit).

These additional refunds will be delivered by paper check mailed to your address on file with the state Treasury. If you still live at the same address as listed on your 2022 tax return (filed in 2023), you do not need to take any action. Checks will be mailed starting February 13, 2024, and it may take as long as 5 to 6 weeks for the state Treasury to mail all of the checks.

If you have moved recently or are concerned that the state of Michigan may not have your correct address, you can update your address online here.

What if I did not file taxes in 2023? Can I still claim the expanded Michigan EITC?

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If you did not file taxes in 2023, you may still be eligible for the expanded Michigan EITC for tax year 2022. To find out if you are eligible and claim your refund, you would need to file a late tax return for tax year 2022. During the main tax season (January through April 15), our tax partners focus on filing current-year taxes so we can help as many people as possible. During the summer and fall, we offer appointments to file tax returns for previous years.

Right now, focus on filing your 2023 taxes in early 2024 so that you can claim the expanded EITC for the 2023 tax year. Get expert help filing your taxes at no cost to you. Then, come back for a second appointment during the summer to complete your 2022 taxes.