Rate (Fully-Refundable): 10% of the federal credit1

Eligibility Requirements: All Indiana taxpayers must have filed for the federal credit and are subject to slightly different income thresholds than the federal guidelines. See the 2015 IT-40 Individual Income Tax Booklet for more details.

Latest Legislative Action: In 2023, House Bill 1290 was proposed to expand the state EITC from 10% to 12% of the federal credit. The bill did not become law.

  • In 2023, EITC was recoupled to the federal credit, but the rate was not increased. This was enacted through the state budget, HEA 1001 (Section 100).
  • In 2021, lawmakers increased the state EITC from 9% to 10% of the federal credit, as it was calculated before 2009 (maintained decoupled status from federal credit). The expansion took effect in 2022.2
  • During the 2016 legislative session, lawmakers considered a bill that would have increased the state EITC to 10% of the federal credit.


  • Indiana’s EITC was created in 1999 but was not based on the federal credit. In 2003, Indiana switched to an EITC model replicating the federal program at 6% of the federal credit. This rate was raised to 9% in 2009 as part of a property tax reform package.3
  • While the federal program was expanded under a 2010 federal tax relief act, Indiana took action to decouple its state eligibility guidelines from the federal system in 2011. As a result, those claiming Indiana’s EITC no longer benefitted from increased payouts for families with three or more children or the “marriage penalty” reduction, which started the income phase-out at a higher income level for married couples.4


Indiana does not currently offer a state-level CTC.


Indiana does not currently offer a state-level CDCTC.


  1. 2022 Publication EIC Indiana Earned Income Credit Booklet, Indiana Archives and Records Administration
  2. HEA 1009 (Section 1), 123rd Indiana General Assembly
  3. HB 1001, 115th Indiana General Assembly
  4. HB 1001, 117th Indiana General Assembly

For More State Information

Erin Macey, Director
Indiana Community Action Association
(317) 270-0874