The Tax Cut for Workers Act of 2025 makes several changes to the Earned Income Tax Credit (EITC), a tax benefit that helps low- and moderate-income working people. Here's what it does in practical terms:

First, it lowers the age requirements for who can claim the credit. Currently, you generally need to be at least 25 years old, but this bill drops that to 19. However, there are exceptions: full-time students can claim it at 24, and young people who were in foster care or are experiencing homelessness can claim it at 18. This means younger workers will have access to tax credits they couldn't get before.

Second, the bill significantly increases the amount of money people can receive through the credit. It roughly doubles certain income thresholds and credit amounts—for example, changing some limits from around $4,200 to $9,800. It also removes the upper age limit of 65, so older workers can continue claiming the credit. These changes mean eligible workers will get larger tax refunds or credits.

Third, the bill makes these changes permanent and adjusts them for inflation each year going forward, so the benefits won't shrink over time. Finally, it adds flexibility for workers whose income drops year-to-year—they can choose to calculate their credit based on their previous year's higher income if that gives them a bigger benefit. All these changes take effect for taxes filed in 2026 and beyond.