Several states have their own version of an earned income tax credit (EITC), which aims to reduce poverty levels among working class families. The state of Delaware offers taxpayers an earned income tax credit that follows the federal guidelines for eligibility. That means if a Delaware resident was able to claim the federal EITC, they will likely be eligible for the state’s credit as well.
Of the twenty one states that offer an earned income tax credit, there are four in which the credit is not refundable. Delaware, along with Maine, Ohio, and Virginia, is one in which the state’s EITC is not refundable. This means that the credit is only offered up to the point that it completely offsets a family’s state income tax liability. It will reduce a family’s income tax bill, but won’t make up for other taxes a working family in Delaware may have to pay.
Delaware’s EITC is offered at 20% of the federal credit. If you’re a resident of Delaware, make sure you check your eligibility to claim both the state and the federal EITC and see where you can save your family money this tax season. It’s important to utilize any tax credits and benefits available, because every penny counts when you’re a lower income taxpayer.