IRS Publication 5489 – The Earned Income Tax Credit (EITC) is a valuable refundable tax credit designed to assist low- to moderate-income workers and families in reducing their tax burden or even receiving a refund. During times of economic hardship, such as the COVID-19 pandemic, the IRS introduced temporary measures to help taxpayers maximize this benefit. One such measure is outlined in IRS Publication 5489, which allows eligible taxpayers to use their 2019 earned income when calculating the EITC for the 2020 tax year. This article explores the details of Publication 5489, eligibility requirements, claiming process, and how it fits into broader EITC rules.
What Is IRS Publication 5489?
IRS Publication 5489, titled “Taxpayers Can Use 2019 Income for Earned Income Tax Credit,” was released in February 2021 as part of relief efforts under the Taxpayer Certainty and Disaster Tax Relief Act of 2020. This one-page document provides guidance for taxpayers whose 2020 income was lower than in 2019 due to pandemic-related disruptions, such as job loss or reduced hours. By electing to use 2019 earned income, qualifying individuals could potentially claim a larger EITC refund.
The publication was made available in multiple languages, including Spanish, Chinese, Korean, Russian, Haitian Creole, and Vietnamese, to ensure accessibility for diverse communities. It emphasizes that this option was specifically for the 2020 tax year, helping families offset financial challenges from the global health crisis.
Eligibility for Using 2019 Income Under Publication 5489
To qualify for using 2019 income in calculating the 2020 EITC, taxpayers needed to meet specific criteria:
- Income Threshold: Your 2020 adjusted gross income (AGI) or earned income must have been less than $56,844 (depending on filing status and number of qualifying children). If your 2019 earned income was higher than your 2020 amount, you could elect to use the 2019 figure for a potentially higher credit.
- Earned Income Definition: Earned income includes wages, salaries, tips, net self-employment earnings, and certain disability payments. Nontaxable items like dependent care benefits do not count.
- General EITC Rules: You must have lived in the U.S. for more than half the year, not be claimed as a dependent on another return, and meet investment income limits (no more than $3,650 for 2020). Special rules applied for military members, clergy, and those affected by disasters.
This provision was particularly beneficial for workers in industries hit hard by lockdowns, allowing them to avoid a reduced credit due to temporary income drops.
How to Claim the EITC Using 2019 Income?
Claiming this benefit was straightforward but required careful attention to IRS forms:
- Determine Eligibility: Use the IRS EITC Assistant tool on IRS.gov to check if you qualify and compare credits using 2019 vs. 2020 income.
- File Your Return: On Form 1040 or 1040-SR for tax year 2020, report your election to use 2019 earned income. Attach Schedule EIC if you have qualifying children.
- Reference Supporting Documents: Consult Publication 596, “Earned Income Credit,” for detailed instructions on calculations and worksheets.
If you missed claiming it on your original 2020 return, you could file an amended return (Form 1040-X) within three years of the original due date. For 2020 returns, this window extended until April 2024.
Maximum EITC Amounts for 2020
The EITC amount varies based on filing status, number of qualifying children, and income. Using 2019 income could increase your credit up to:
- $6,660 for families with three or more qualifying children.
- $5,920 for two qualifying children.
- $3,584 for one qualifying child.
- $538 for no qualifying children.
These figures reflect the maximums for 2020, and electing prior-year income helped many taxpayers reach closer to these caps despite lower earnings that year.
How Does This Compare to Current EITC Rules in 2026?
While Publication 5489 was a temporary measure for 2020, a similar “lookback” rule allowed taxpayers to use 2019 income for the 2021 EITC as well, under the American Rescue Plan Act. However, for tax year 2025 (filed in 2026), the EITC is calculated based on current-year earned income only, without a general prior-year election unless specified in new disaster relief legislation.
Current 2025 EITC limits include:
- Maximum credit: Up to $7,830 for three or more qualifying children (adjusted for inflation).
- Income caps: AGI less than $61,555 ($68,675 married filing jointly) for three or more children.
- Investment income limit: $11,950.
Taxpayers affected by federally declared disasters may still qualify for lookback provisions on a case-by-case basis, as recommended by the Taxpayer Advocate Service. Always check the latest Publication 596 or use the EITC Assistant for up-to-date eligibility.
Why Publication 5489 Matters Today?
Even though the specific rule in IRS Publication 5489 applied to past tax years, it highlights how the IRS adapts to economic crises to support working families. If you’re filing back taxes or amending returns, this guidance remains relevant. For current filings, focus on accurate reporting of earned income to maximize your EITC.
For the most accurate advice, consult a tax professional or visit IRS.gov. Remember, claiming the EITC can significantly boost your refund—don’t overlook it if you qualify.
This article is for informational purposes only and not tax advice. Consult the IRS or a qualified professional for personalized guidance.