EITC Lookback Act

The EITC Lookback Act (HR 2898) allows low-income workers with fluctuating income to use their previous tax year's earnings when calculating their Earned Income Tax Credit (EITC), instead of their current year's lower earnings. It directly affects qualifying taxpayers whose income drops from one year to the next, such as those facing temporary job loss or reduced hours. The key provision lets eligible individuals choose to substitute their prior year's earned income for the current year's in determining their EITC amount. This change applies to tax years beginning after December 31, 2024, providing potential tax relief for workers experiencing income volatility.