Overview
Form IT-215 is used to claim the New York State and New York City Earned Income Credit (EIC). It is a refundable credit for low-to-moderate income working individuals and families. Unlike a deduction, which reduces taxable income, a credit reduces your tax liability dollar-for-dollar. If the credit exceeds your tax liability, you receive the difference as a refund.
The New York credit piggybacks directly on the federal Earned Income Tax Credit (EITC). Generally, if you qualify for and claim the federal credit, you qualify for the New York version.
2026 Tax Year Rate Change
For taxable years beginning on or after January 1, 2026, the New York State EIC percentage increases from 30% to 45% of the federal credit. This is legislatively enacted but not yet reflected in current-year forms. Taxpayers filing 2026 returns will use the 45% rate. All references to 30% apply to tax year 2025 and prior.
Who Qualifies
To claim the New York State EIC on Form IT-215, you must meet all of the following:
- Federal EIC Claimed: You must have qualified for and claimed the federal Earned Income Tax Credit on your federal return. This is non-negotiable.
- No Noncustodial Parent Credit: You cannot have claimed the New York Noncustodial Parent Earned Income Credit (Form IT-209) for the same tax year.
- Valid Social Security Numbers: You and each qualifying child must have a valid SSN issued by the due date of the return (including extensions). ITINs do not qualify.
- Investment Income Limit: Your total investment income cannot exceed the federally defined threshold (for 2026, this limit is $12,200).
- Filing Status Restriction: You cannot use “Married Filing Separately” for New York purposes unless you meet narrow exceptions.
- New York City EIC: You qualify for the NYC EIC if you were a full-year or part-year NYC resident and claimed the federal EIC — even if you do not qualify for the NYS EIC.
How the Credit Is Calculated
New York State EIC
- Generally 30% of your allowable federal earned income credit (for tax years prior to 2026).
- Increases to 45% for tax year 2026 and thereafter.
- The credit is then reduced by the amount of any household credit you claimed on your New York return.
New York City EIC
- Based on your New York adjusted gross income (NYAGI).
- Ranges from 5% to 30% of your federal EIC.
- The specific percentage is determined using the NYC EIC Rate Table in the form instructions.
Maximum Combined Credit: When combined with federal, New York State, and New York City credits, a family with three or more qualifying children can receive up to $12,873 (2026 figures).
Residency and Refundability Rules
| Residency Status | NY State EIC | NYC EIC |
|---|---|---|
| Full-Year NY Resident | Fully refundable | Eligible (if NYC resident) |
| Nonresident | Nonrefundable (reduces tax to zero only) | Generally not eligible |
| Part-Year NY Resident | Partially refundable (allocated by days) | Eligible if NYC resident during period |
Part-Year Residents: Complete lines 18 through 26 of Form IT-215 to allocate the credit based on the number of days you were a New York State resident. The formula: (Full-year credit) × (NY resident days ÷ 365).
Part-Year NYC Residents: You must also complete Form IT-360.1 (Change of City Resident Status) and the NYC EIC allocation on Form IT-215, line 28.
Form Instructions — Key Lines
- Line 1: Check “Yes” only if you claimed the federal EIC. If “No,” stop — you do not qualify.
- Line 2: Calculate your total investment income. If this exceeds the annual limit, you are disqualified.
- Line 4: List each qualifying child claimed on your federal Schedule EIC. Provide full name, SSN, date of birth, and relationship.
- Line 6: Complete Worksheet A to calculate your total earned income (wages, salaries, tips, plus nontaxable combat pay).
- Line 9: Enter your federal adjusted gross income from your federal return.
- Line 16: Allowable New York State EIC. Transfer to Form IT-201, line 65 (full-year residents) or Form IT-203, line 43 (nonresidents and part-year residents).
- Line 17: Joint Federal, Separate New York Filers Only — split the total credit with your spouse. Combined amounts cannot exceed line 16.
- Lines 18–26: Part-Year Residents Only — calculate the refundable portion based on your NY AGI ratio.
- Lines 27–28: NYC Residents Only — complete Worksheet C using the NYC EIC Rate Table. Transfer line 27 to Form IT-201, line 70.
Worksheets Guide
Worksheet A — Wages, Salaries, Tips
Line 1: Federal Form 1040, line 1z. Line 2: Nontaxable combat pay (Form 1040, line 1i). Line 3: Add lines 1 and 2 → Form IT-215, line 6.
Worksheet B — Credit Adjustments
Used to account for New York State resident credit (taxes paid to other jurisdictions) and accumulation distribution credit carryovers. Complete on the back of Form IT-215 before entering amounts on lines 13–15.
Worksheet C — New York City EIC
- Based on NYAGI (IT-201 line 33 / IT-203 line 32).
- Use the NYC EIC Rate Table to determine your credit percentage (ranges from 5% to 30%).
- Part-year residents must allocate credit based on NYC residency period.
Frequently Asked Questions
What is the New York State EIC percentage for 2026?
45%. Legislation passed in 2025 increases the applicable percentage from 30% to 45% for taxable years beginning on or after January 1, 2026.
I am a part-year resident. Can I claim the full credit?
No. You must allocate the credit based on the number of days you were a New York resident. Complete Form IT-215, lines 18–26.
I live in New York City. Do I need to file a separate form for the NYC EIC?
No. You claim the NYC EIC on the same Form IT-215. Complete Worksheet C and enter the amount on lines 27–28. Transfer the total to Form IT-201, line 70.
My child has an ITIN, not an SSN. Can I claim the credit for them?
No. Both you and each qualifying child must have a valid Social Security Number issued by the return due date. ITINs are not acceptable for the EIC.
I do not owe any New York tax. Should I still file Form IT-215?
Yes. The credit is refundable. You will receive the full credit amount as a refund, even if you owe zero tax. You must file a New York return to claim it.
I am a nonresident with New York source income. Do I qualify for the NY EIC?
Yes, but it is nonrefundable. The credit can reduce your New York tax liability to zero, but you will not receive any excess as a refund.
My spouse and I filed a joint federal return but are filing separate New York returns. How do we claim the credit?
Complete one Form IT-215 with both spouses' information. Enter the total credit on line 16. On line 17, enter your portion. Your spouse claims their portion on their separate return. The combined amounts cannot exceed line 16.
What records do I need to keep if I am self-employed?
The NYS Tax Department requires contemporaneous daily records of business income and expenses — bank statements, deposit slips, invoices, and 1099s. Without these, the credit will be denied.
Need Help Claiming the Earned Income Credit?
Given the significant rate increase for 2026, the strict SSN requirements, the complex allocation rules for part-year residents, and the detailed recordkeeping mandates for self-employed individuals, taxpayers claiming the New York State and New York City Earned Income Credit are strongly advised to consult with a qualified tax professional to ensure accurate computation, proper documentation, and maximum refundable benefit. Contact Dimov Tax & CPA Services.