EITC Lookback Act

Introduced on April 10, 2025 by Emilia Strong Sykes

This bill would let people who qualify for the Earned Income Tax Credit (EITC) choose to use last year’s earned income if their income went down this year. This can help keep their EITC from dropping suddenly when work hours are cut, a job is lost, or pay is lower. The choice is up to the taxpayer each year the income dips, and it applies permanently, not just in emergencies.

Key points:

• Who is affected: Workers and families who claim the EITC and had lower earned income than the year before.
• What changes: You may elect to calculate your EITC using the prior year’s earned income if it’s higher than this year’s, to get a larger credit than you otherwise would.
• When: Applies to tax years starting after December 31, 2024.