YourVoice.Now Summary
Your MoneyTransparency & AccountabilityCaregivers, college students, and workers as young as 18 could claim the earned income tax credit — and take it monthly.
Your Money
Today the credit's larger amounts go to workers with a qualifying child. The bill would also count dependents who are 65 or older, and a spouse or dependent who cannot care for themselves.
A college student could claim the credit as long as no one else claims them as a dependent. They must get a Pell Grant, or have income under 250% of the poverty line.
Today workers with no qualifying child must be 25 to 64 to claim the credit. The bill would set the floor at 18 and remove the upper limit.
Some filers would get at least $1,200, even when the usual math gives less. That covers students, parents of a child under 7, and caregivers of older or disabled dependents.
Refunds over $240 could arrive in 12 monthly pieces instead of all at once. The payments carry interest and come by direct deposit or prepaid card, never a check.
A parent who chose monthly payments would not have to wait for next year's tax return. The remaining payments would be raised to count the new child.
The IRS would give matching grants to colleges, nonprofits, tribes, and local agencies that run free tax sites. Nine out of ten people they serve must be low-income.
Transparency & Accountability
The IRS would visit funded sites and measure how accurate their returns are. A site under 90% accuracy could not get another grant until it documents fixes.
More about this bill
If you work and care for an aging parent, your tax refund could grow. The Earned Income Tax Credit is a refund for lower-paid workers. Today the amount turns on how many qualifying children you claim. The bill would count more people as qualifying dependents. Dependents age 65 and older would count. So would a spouse or dependent who cannot care for themselves. Low-income college students could claim the credit on their own. They would need a Pell Grant, or income under 250% of the poverty line. Students claimed as a dependent by someone else would not qualify. Workers with no dependents could claim it at age 18, not 25. The upper age limit of 65 would go away. Students and some caregivers would get at least $1,200. That floor also covers parents of children under 7. You could take the credit in monthly payments instead of one yearly refund. That choice opens when your refund tops $240. The first payment would be larger, and eleven smaller ones would follow. The first time you use it, that opening payment would double. The payments would carry interest. The money would come by direct deposit or prepaid card, never by check. If a child is born or adopted, the payments would rise right away. The bill would also pay for free tax help. The IRS could make matching grants to groups that prepare returns for low-income filers. Grants would be capped at $30 million a year. One grant could run up to three years. IRS staff would visit the sites to check accuracy. Sites below 90% accuracy could lose future grants. All of these changes would start with tax years that begin after the bill becomes law.
Congressional Summary
EITC Modernization Act This bill expands eligibility for the earned income tax credit (EITC), provides a minimum EITC amount of $1,200 (subject to limitations), and allows an individual to receive the EITC as monthly payments. The bill also establishes a grant program for tax return preparation assistance for low-income individuals. Under the bill, EITC eligibility is expanded to include a student who meets certain requirements and an individual with a qualifying dependent, which includes a qualifying child, dependent who attains the age of 65 within the tax year and for whom the individual may claim a tax deduction for a personal exemption, and dependent or spouse who is physically or mentally incapable of caring for themselves and meets certain residency requirements. Further, for an individual who does not have a qualifying dependent, the bill lowers the EITC eligibility age to 18 years (from 25 years) and eliminates the maximum age limit. The bill allows an individual who meets certain requirements to receive the EITC in monthly payments and provides for a one-time increase in the first monthly payment. The bill also provides a new parent (through birth or adoption) an increase in their monthly EITC payments (subject to limitations). Finally, the bill establishes a grant program, which is similar to the existing Volunteer Income Tax Assistance program and provides funding for tax return preparation assistance for low-income taxpayers and members of underserved populations.
Details
- Congress
- 119th
- Chamber
- House
- Status
- summarized
- Action
- Introduced in House
- Action Date
- 2025-01-31
- Date Added
- 2026-05-02
- Source
- Congress.gov →
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