Laylabird | E+ | Getty ImagesTens of millions of Americans file tax returns every year — and many are missing a "valuable credit," according to the IRS.
In 2022, roughly 23 million filers received $57 billion from the earned income tax credit, or EITC, a tax break for low- to moderate-income workers.
But nearly 1 in 5 eligible taxpayers don't claim the EITC, which averaged $2,541 in 2022, IRS Commissioner Danny Werfel told reporters during a press call last week.
How the earned income tax credit works"The credit is reasonably complex," said Steven Hamilton, assistant professor of economics at The George Washington University.
There's a 'high improper payments rate'"Millions of eligible taxpayers fail to claim the EITC, while other taxpayers claim amounts for which they are not eligible, leading to a high improper payments rate," National Taxpayer Advocate Erin Collins wrote in the 2023 Purple Book of legislative recommendations.
Persons:
Danny Werfel, you've, Steven Hamilton, Hamilton, There's, Erin Collins
Organizations:
The George Washington University, IRS, Center, Black, Stanford University
Locations:
U.S