Boost the Middle Class Act Hikes EITC Thresholds: Bigger Tax Credits Coming in 2026

The “Boost the Middle Class Act” is taking aim at the Earned Income Tax Credit (EITC), a major support for working families, by significantly increasing how much money you can earn and still qualify for a substantial credit. Think of the EITC as a refund for working people with low to moderate incomes—and this bill is making that refund much easier to get and keep.

The core of the change, found in Section 2, is a massive overhaul of the income thresholds used to calculate the EITC. Essentially, the bill is raising the ceiling on who qualifies and where the credit starts to shrink. For example, some base earned income amounts are jumping from around $6,330 up to $13,629, and another is moving from $8,890 to $19,140. This means more of your earned income counts toward maximizing the credit before the government starts phasing it out.

The New EITC Math: Who Benefits and When

For those juggling work and family, these changes mean a bigger break at tax time. The bill specifically raises the income levels where the credit begins to “phase out” or shrink. Currently, if your income hits a certain point, the credit starts disappearing fast. Under this bill, phaseout amounts are being raised from around $11,610 to $24,992 in key areas. For a single parent working a steady job, this translates directly into a higher take-home benefit because they can earn more without losing the credit.

Married couples filing jointly also get a specific boost. The income limit where their phaseout begins is being raised from $5,000 to $7,612. This is a clear acknowledgement that two-earner households need more room to grow their income without being penalized by the tax code. It’s about letting working couples keep more of what they earn, helping them manage rising costs for things like childcare and housing.

Keeping Up with Inflation (Finally)

Another detail that often gets overlooked but is crucial for the long haul is the update to how these EITC figures are adjusted for inflation. The bill changes the baseline year for future inflation adjustments from 2015 to 2026. Why does this matter? Because using a more recent year as the starting point ensures that the EITC’s value doesn’t erode as quickly due to inflation. It’s the difference between using five-year-old prices to calculate today’s credit versus using prices that are closer to current reality—a small change in the law that makes a big difference in the credit’s real-world buying power over time.

If you’re doing your tax planning, mark your calendar: these higher credit amounts and new thresholds only apply to tax years that begin after December 31, 2025. While the changes are significant and beneficial for working families, the actual impact won't be seen until the 2026 tax filing season.