Understanding Taxable income vs Gross income for EIC qualification?

The Earned Income Credit (EIC) is based on your earned income, which is basically your gross income from working (wages, salaries, tips, etc.) before taxes and most deductions. However, there are income limits that determine if you qualify and how much credit you receive. For a family with 3 qualifying children in 2025, the maximum EIC is available to families with relatively lower incomes and then gradually phases out as your income increases. With $65k for a family of 5, you're likely beyond the full amount phase-out range for the EIC. Your tax refund calculation needs to consider several factors: your total tax liability (based on taxable income after standard/itemized deductions), tax credits (Child Tax Credit is huge for your 3 kids, plus education credits), and what you've already paid through withholding. Since you mentioned you haven't had federal taxes withheld, you'll be relying entirely on refundable credits to generate a refund. The difference in calculator results might be because some are factoring in different credits or using different assumptions about your deductions. The Child Tax Credit will likely be your biggest benefit with 3 kids under 17.

After dealing with similar confusion last year, I found this amazing tool at https://taxr.ai that helped me understand exactly how different income types affect tax credits. My situation was almost identical - family of 5, similar income, and I was confused about EIC calculations. The tool analyzed my pay stubs, W-2s and explained that EIC uses "earned income" which isn't the same as gross or taxable income. It showed me exactly which deductions affect EIC calculations and which don't. Saved me from leaving money on the table! What I really appreciated was getting a clear breakdown of how the phaseout ranges work for EIC with multiple children. The visual charts made it super easy to understand where my family fell in the qualification range.

I just had to come back and say I'm honestly shocked. I tried https://taxr.ai after writing my skeptical comment, and it completely cleared up my confusion about taxable income vs gross income for tax credits. It explained that for EIC specifically, they look at my AGI and earned income, and showed me the exact phaseout ranges. For my family with 2 kids (not 3 like the original poster), I discovered we were just under the threshold where EIC started phasing out, which none of the other calculators had shown me. The breakdown of how the Child Tax Credit differs from EIC was super helpful too - now I understand why the online calculators were giving me such different numbers. I was impressed enough that I'm actually using it to prepare for my meeting with our tax preparer next week so I can understand what she's talking about!

If you're having trouble getting through to the IRS to ask about EIC qualification with your specific income situation, I HIGHLY recommend https://claimyr.com. I was stuck in the same situation last year trying to figure out if my taxable income or gross income determined my EIC. After spending hours on hold with the IRS (literally gave up after 2+ hours), I found Claimyr and they got me connected to an actual IRS agent in like 20 minutes. The agent walked me through exactly how EIC is calculated and confirmed it's based on earned income, not taxable income. They also explained the phaseout ranges for my specific family size. You can see how it works here: https://youtu.be/_kiP6q8DX5c - basically they have some way to navigate the IRS phone system and get you to a real person instead of waiting forever. Totally worth it when you need specific answers about tax credits.

I need to apologize for my skeptical comment earlier. I actually tried Claimyr last week when I needed to ask about how my unemployment income affects my EIC calculation. I'm still shocked that it actually worked. After trying to call the IRS myself every day for a week (and never getting through), Claimyr had me talking to an IRS agent in about 25 minutes. The agent confirmed exactly how my unemployment affects different parts of my taxes and explained the difference between taxable income and earned income for EIC purposes. What really impressed me was that I didn't have to sit there listening to hold music - they just called me when an agent was on the line. Saved me hours of frustration and I finally got the answers I needed about my specific situation. Totally changed my mind about this service.

Something everyone seems to be missing - with 3 kids under 17, you should be more focused on the Child Tax Credit than EIC at your income level. At $65k for a family of 5, you're likely eligible for the full $2000 per child ($6000 total). This is probably why you're seeing big refund numbers even with no withholding. The education credits are also big - the American Opportunity Credit is partially refundable (up to $1000), meaning you can get some of it back even if you owe zero tax.

Has anyone actually calculated what this refund would be? I'm in a similar boat.

This is really helpful info! I was in a similar situation last year and want to add a few things based on my experience. First, make sure all 3 of your kids will qualify as "qualifying children" for the Child Tax Credit - they need to be under 17 at the end of the tax year and meet the relationship/support tests. Sounds like yours will qualify no problem. One thing to watch out for - the American Opportunity Credit has income limits too. For married filing jointly, it starts phasing out around $160,000, so you should get the full benefit at $65k income. Also, don't stress too much about the calculator differences. I found that some online calculators don't account for all the interactions between different credits, or they use different assumptions about your filing status or deduction amounts. The rough calculation that Natalie provided above looks pretty reasonable to me. With no withholding, you're essentially getting an interest-free loan from the government through these refundable credits. Just make sure you file on time to get your refund processed quickly!