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Earned Income Credit |

The Earned Income Credit

The Revenue Reconciliation Act of 1993 expanded the earned income tax credit for tax years beginning after 1993. The expanded credit extends availability to individuals without children and increases the credit percentages, phase out percentages, earned income amounts, and phase out amounts. The supplemental young child credit and the supplemental health insurance credit were repealed.

The earned income and phase out amounts are adjusted for inflation for tax years beginning after December 31, 1993. For 2011, the maximum amount of the credit is:

  • $5,751 with three or more qualifying children; 
  • $5,112 with two qualifying children; 
  • $3,094 with one qualifying child; 
  • $464 with no qualifying children.

The Advanced Earned Income Credit was discontinued for federal purposes effective 1/1/2011. Form W-5 is no longer valid. is a free online resource featuring a compilation of research, collaboration and web tools for use by payroll professionals and more including information about payroll tax articles, federal tax information and state tax information.

Helpful Hint... Anytime you move or have a major life change (for example - marriage, divorce, birth of a child, etc.) always be sure to complete a new W-4!