EITC investment income limits by tax year
| Tax year | Investment income limit |
|---|---|
| 2025 | $11,950 |
| 2026 | $12,200 |
Note: The IRS adjusts this limit for inflation most years, so it’s worth checking the current figure before you file rather than relying on last year’s number.
What counts as investment income for the EITC
Investment income for EITC purposes includes:
- Taxable interest and tax-exempt interest
- Ordinary dividends
- Capital gains
- Rental and royalty income
- Passive activity income
Wages, tips, and net self-employment earnings don’t count toward this limit—those are earned income, which is measured separately.
What happens if you go over the limit
There’s no partial credit here. Say your investment income for 2026 comes to $12,500, just $300 over the $12,200 limit ($12,500 − $12,200 = $300). Even if your earned income and adjusted gross income (AGI) both fall comfortably within the EITC’s limits, that $300 overage disqualifies you from the credit for the entire year. There’s no reduced or prorated version of the EITC for filers who are close to the investment income limit. You either qualify, or you don’t.
How this fits into overall EITC eligibility
The investment income limit is only one of several tests you need to pass to claim the EITC. You also need:
- Earned income and AGI under the limit for your filing status and number of qualifying children
- A valid Social Security number for yourself, your spouse (if filing jointly), and any qualifying child you claim
- A filing status other than Married Filing Separately, with limited exceptions
