EITC Turns 50

By Stephanie Bonin, Senior Strategist at Economic Security Project & Vermont VITA Volunteer

Today, January 31, marks the 50th anniversary of the Earned Income Tax Credit (EITC), a policy that has helped millions of working families make ends meet every year. Established in 1975, the EITC has long enjoyed broad support as a powerful, proven tool for strengthening economic stability for low- and middle-income families and workers.

Even as we celebrate this milestone, discussions are underway about potential changes to the tax system that could affect the EITC and other tax provisions. The EITC isn’t a handout–it’s a crucial part of our tax system that ensures eligible workers, with or without children, can keep more of the hard-earned money they earn. Some proposed changes, including the elimination of the Head of Household filing status, could disproportionately harm single parents, making it even harder for them to stay financially stable.

Every year, the EITC delivers an average refund of $2,700 to approximately 23 million workers and families—half of whom are single parents.

It is essential to preserve and strengthen policies that help working families, like the EITC that has lifted millions out of poverty over the past five decades.

As volunteer tax preparers, we see firsthand how vital the EITC is for single working parents.  Kids’ needs don’t shrink just because they have one parent instead of two—essentials like breakfast cereal, school clothes, and gas cost the same. 

The EITC has proven to help families keep up with rising costs, but its impact depends on making tax filing as accessible as possible. Right now, one in five eligible tax filers miss out on the credit simply because the tax filing process feels overwhelming. That’s why free filing tools are so important—and one of the most accessible options is IRS Direct File. Now available in 25 states, Direct File is a simple, secure, and completely free way to file both federal and state tax returns directly with the IRS. 

This tax season, let’s work together to ensure every eligible taxpayer knows about this game-changing tool. Direct them to check their eligibility and file for free at directfile.irs.gov.

As trusted messengers, we need your help spreading the word about this new, free tool. And now, the Volunteer Income Tax Assistance (VITA) and the Tax Counseling for the Elderly (TCE) tax preparation sites can receive credit toward their grant production goals by promoting IRS Direct File. You can also get a unique referral link to track your Direct File referrals by submitting this form.

We know that many eligible taxpayers don’t file simply due to the fact that the process feels overwhelming, leading to stress, anxiety, and missed refunds worth thousands of dollars. However, during last year’s Direct File pilot, we saw firsthand how this new, easy-to-use tool can remove barriers—making filing fast, secure, and truly free (no ads, no upsells).

90% of Direct File users rated their experience as “excellent” or “above average.”

And 16% of all Direct File users were new or intermittent tax filers, proving that it’s helping bring more eligible taxpayers into the system—ensuring they receive the credits they’ve earned.

What You Need to Know About Direct File: 

• Available to 32 million Americans 

• Supports  standard deductions and common credits like EITC & CTC

• Now in 25 states

• Auto-fills personal and wage information from W-2s

As we celebrate 50 years of the EITC and the expansion of Direct File to more states, let’s continue to work together to protect and strengthen this essential program and impactful tool, so that every hardworking American can access their refunds and build a more secure future.