Order Code RS22316
November 4, 2005
CRS Report for Congress
Received through the CRS Web
The Earned Income Tax Credit (EITC):
Percentage of Total Tax Returns and Credit
Amount By State
Christine Scott
Specialist in Tax Economics
Domestic Social Policy Division
Summary
The earned income tax credit (EITC), established in the tax code in 1975, provides
cash assistance to lower income working parents and individuals through the tax system.
In tax year 2003, total EITC (EITC applied against tax liability and refunded EITC) was
$39.2 billion, with 22.1 million tax returns claiming the EITC. Geographically, the four
largest states in terms of population — California, Texas, Florida, and New York — had
35.1% of all federal tax returns claiming an EITC and 35.9% of the total EITC amount.
States with a higher percentage of federal tax returns claiming the EITC were located
in the South, with Mississippi (31.87%) and Louisiana (28.45%) having the highest
percentage of federal tax returns claiming the EITC. This report will be updated when
new data become available.
The Earned Income Tax Credit (EITC)1
The earned income tax credit (EITC) is a refundable tax credit available to eligible
workers earning relatively low wages. Under current law, two categories of EITC
recipients exist: childless adults and families with children. Because the credit is
refundable, an EITC recipient need not owe taxes to receive the benefits. Eligibility for,
and the size of, the EITC is based on income, age (25 or older but less than 65 years of
age), residence (U.S. resident unless military stationed overseas), and the presence of
qualifying children.
The distribution of federal tax returns claiming the EITC by state can be shown in
two simple ways. First, the largest four states in terms of population — California, Texas,
Florida, and New York — had the largest number of federal tax returns and EITC amount,
accounting for 35.1% of all federal tax returns claiming the EITC and 35.9% of the total
EITC amount in tax year 2003. Alternatively, the distribution can be shown using the
1 A more detailed description of EITC eligibility and the calculation of the credit are in CRS
Report RL31768, The Earned Income Tax Credit (EITC): An Overview, by Christine Scott.
Congressional Research Service ˜ The Library of Congress

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CRS-2
percentage of federal total tax returns filed from a state claiming the EITC. In tax year
2003, for the United States (the sum of all states and the District of Columbia, not
including outlying areas), 17.01% of tax returns claimed an EITC, with an average EITC
of $1,772.48.
The Percentage of Tax Returns Claiming the EITC
The percentage of federal tax returns filed from a state claiming the EITC is an
indicator of the dependence of state residents on the EITC. It can also be viewed as an
indicator of the relative income of states. States with a higher proportion of lower income
working residents (particularly those with children) will have a higher percentage of
federal tax returns filed from the state claiming the EITC. For tax year 2003, the District
of Columbia and 19 states had a share of federal tax returns claiming the EITC that was
greater than or equal to the U.S. average (for all states and the District of Columbia) of
17.01%. Thirty-two (32) states had a percentage of federal tax returns with an EITC that
was lower than the U.S. average.2
The percentage of federal tax returns claiming an EITC ranged from a low of 9.78%
in New Hampshire to a high of 31.87% in Mississippi. Map 1 shows a graphical
presentation of the percentage of federal tax returns claiming the EITC by state. Table
1 provides data on the number of federal tax returns filed by state and the percentage of
federal tax returns claiming an EITC by state in tax year 2003.
The Average Amount of the EITC
The amount of the EITC depends upon income and the number of qualifying
children. For tax year 2003, the maximum EITC for individuals and married couples was
$382 with no qualifying children, $2,547 with one qualified child, and $4,204 for two or
more qualifying children. However, these maximum credit amounts are only for
individuals and couples with incomes below the levels at which the credit begins to phase
out. For tax year 2003, the income level at which the EITC began to phase out was
$6,240 if the tax filer had no qualifying children and $13,730 if the tax filer had one or
more qualifying children. For married tax filers filing a joint return, the income levels
were $1,000 higher. Tax filers received no EITC in tax year 2003 if they had an adjusted
gross income of more than $11,230 with no children, $29,670 ($30,670 if married), and
$33,690 ($34,690 if married). Public IRS data show that tax returns with an adjusted
gross income below $30,000 had a larger EITC ($1,832) than tax returns with an adjusted
gross income of $30,000 or more ($443) in tax year 2003. Map 2 shows a graphical
presentation of the average EITC amount by state.
2 All percentages and dollar amounts in this report were prepared by the Congressional Research
Service using Internal Revenue Service’s Historical table 2 (Statistics of Income Bulletin) for all
states and the United States, available at [http://www.irs.gov/pub/irs-soi/03in54cm.xls] and
[http://www.irs.gov/pub/irs-soi/03in53us.xls]. EITC includes the EITC applied against tax
liability and the excess (refunded) EITC.

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CRS-3
Map 1. Percentage of Tax Year 2003 Tax Return with an Earned
Income Tax Credit by State
Map 2. The Average Earned Income Tax Credit Amount by State for
Tax Year 2003
Source: Maps computed by the Congressional Research Service from IRS, Historical Table 2 (Statistics
of Income Bulletin), available at [http://www.irs.gov/taxstats/indtaxstats/article/0,,id=103106,00.html]

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CRS-4
Table 1. Total Number of Tax Returns, Percentage of Federal Tax
Returns Claiming an Earned Income Tax Credit (EITC), and Average
EITC by State, Tax Year 2003
Number of
Percentage of
Average
Federal Tax
Federal Tax Returns
EITCa
Returns
Claiming the EITC
Total — All States
129,810,122
17.01%
$1,772.48
Alabama
1,883,765
25.73
2,023.52
Alaska
343,032
11.29
1,494.50
Arizona
2,285,323
17.49
1,776.14
Arkansas
1,121,518
24.81
1,899.58
California
15,171,832
16.54
1,745.90
Colorado
2,079,044
12.85
1,593.07
Connecticut
1,653,789
10.15
1,564.88
Delaware
388,288
14.66
1,703.60
District of Columbia
275,645
18.77
1,681.55
Florida
7,849,542
20.08
1,781.61
Georgia
3,709,312
22.79
1,944.01
Hawaii
591,084
14.48
1,552.74
Idaho
577,926
17.52
1,694.88
Illinois
5,722,755
14.94
1,754.98
Indiana
2,816,535
15.12
1,686.71
Iowa
1,324,876
13.01
1,571.09
Kansas
1,218,580
14.56
1,664.30
Kentucky
1,740,856
19.68
1,718.03
Louisiana
1,879,651
28.45
2,085.93
Maine
615,092
14.13
1,556.39
Maryland
2,601,859
13.44
1,676.38
Massachusetts
3,051,697
10.09
1,521.31
Michigan
4,546,347
14.18
1,708.15
Minnesota
2,383,813
10.85
1,534.55
Mississippi
1,169,646
31.87
2,084.70
Missouri
2,563,895
17.01
1,720.42
Montana
433,522
17.18
1,624.16
Nebraska
802,709
13.75
1,641.20
Nevada
1,044,025
15.33
1,653.64
New Hampshire
634,654
9.78
1,498.11
New Jersey
4,082,108
12.14
1,691.43
New Mexico
813,731
24.40
1,795.38
New York
8,589,932
17.42
1,738.15
North Carolina
3,680,813
20.40
1,829.85
North Dakota
302,426
13.18
1,584.97
Ohio
5,444,137
14.45
1,708.71
Oklahoma
1,460,943
21.47
1,809.32
Oregon
1,571,871
14.32
1,601.93
Pennsylvania
5,771,764
13.40
1,622.54
Rhode Island
498,063
13.13
1,645.88
South Carolina
1,804,803
23.47
1,864.24
South Dakota
357,449
15.51
1,627.85
Tennessee
2,565,045
21.31
1,806.61
Texas
9,298,799
23.25
1,967.75

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CRS-5
Number of
Percentage of
Average
Federal Tax
Federal Tax Returns
EITCa
Returns
Claiming the EITC
Utah
969,812
14.41
1,701.32
Vermont
302,209
12.68
1,470.87
Virginia
3,431,766
14.58
1,712.23
Washington
2,808,556
12.63
1,614.43
West Virginia
744,440
19.60
1,666.90
Wisconsin
2,589,845
11.33
1,585.01
Wyoming
240,998
14.31
1,593.23
Source: Table Prepared by the Congressional Research Service from Internal Revenue Service,
Historical table 2 (Statistics of Income Bulletin), available at
[http://www.irs.gov/pub/irs-soi/03in54cm.xls].
a. Earned income tax credit is total EITC and reflects both the portion applied against tax liability and
any excess refunded to tax filers.

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