$550 Earned income tax credit - do you qualify?

Dated: January 30 2024

Views: 343

For those of us who are of working age, our employers are required to provide us a W2 form or 1099 by January 31st.  Many of us get the W2, jump onto turbo tax or something similar and file a return immediately and hopefully get some money back.  (Getting money back is actually a bad thing based on deductions, but that's a different story)  Yet, there is a program here in Michigan called the EITC - Earned Income Tax Credit which could come as an added surprise in the mail for you.

So, what is the EITC and who gets it?  

Starting on February 13th, an estimated 700,000 households will receive refund checks averaging $550.  Early last year, Governor Whitmer signed a new law which expanded the EITC for lower income workers, upping the previous tax credit from 6% to 30% of the federal version.  If you qualified for the credit in 2022, you will automatically receive the new check without any additional steps.  The checks will start rolling out in mid-February and complete by the end of March.

Who qualifies?

According to Bridge Michigan,, the tax credit was first implemented at the federal level as a guaranteed tax refund credit for residents who don't make very much money.

In Michigan, a married couple with three dependents who earned less than a combined $59,187 for the 2023 tax year will qualify for the credit, as well as individuals who earned less than $16,480.

What was it before?

With the revision in the law language, the new calculation is based on 30% instead of 6% of the federal level.  For comparison purposes, checks last year ranged from $34 to $416 and averaged $150.  With the new change in place, credits would range from $168 to $2080, with an average of $750.

Will it affect the State of Michigan budget?  

Yes, it is estimated that this will reduce state tax revenue by $883 million in 2024.  Nothing is free, folks!

Cheers to the bonus money and save it wisely!

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Andy Hargreaves

#1 Agent Nationally for Coldwell Banker for # of homes sold in 2015 Top 5 Nationally in Sales for Coldwell Banker 2011-2015 #1 Coldwell Banker Agent in Michigan for homes sold in 2011-2016 Top 10 Team....

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