How California's CalEITC and Young Child Tax Credit Work - and Who Qualifies
What is the CalEITC and who qualifies for it in California?
CalEITC is California's Earned Income Tax Credit, a refundable credit for low- to moderate-income workers including the self-employed. To qualify, you need earned income from wages or self-employment, meet the FTB's current income limits, and have a valid Social Security number or qualifying ITIN. Income thresholds and credit amounts adjust periodically, so verify current figures at ftb.ca.gov.
How much is California's Young Child Tax Credit?
California's Young Child Tax Credit is an additional refundable credit available to CalEITC-eligible taxpayers who have a dependent child under age 6 as of December 31 of the tax year. The credit has been set at around $1,117 per return in recent years, but the FTB adjusts this amount annually. Confirm the current figure for your specific tax year at ftb.ca.gov.
Can I claim both CalEITC and the federal Earned Income Tax Credit?
Yes. CalEITC and the federal Earned Income Tax Credit are separate programs with separate eligibility rules and calculations. Qualifying for one does not automatically qualify you for the other, and claiming one doesn't reduce what you receive from the other. You claim the federal EITC on your federal return and CalEITC on your California state return using FTB Form 3514.
Do I need to owe California income taxes to benefit from CalEITC?
No. CalEITC is a refundable credit, meaning if the credit amount exceeds what you owe in California state income tax, the Franchise Tax Board will send you the difference as a refund. Californians who owe little or nothing in state taxes can still receive a CalEITC payment, which is why filing a state return matters even for very low-income workers.
Can self-employed Californians claim CalEITC?
Yes, self-employed Californians are eligible for CalEITC as long as they meet the income requirements and properly report their net self-employment earnings on their state return. Earlier versions of the credit excluded self-employed workers, but California expanded eligibility. The FTB's current instructions at ftb.ca.gov outline what documentation and forms are required for self-employed filers.
California has its own versions of the Earned Income Tax Credit that are separate from the federal EITC and, for lower-income working families, can add up to a meaningful amount of money back at tax time. But a lot of Californians who qualify never claim them, either because they don't know the credits exist or because they assume one filing covers everything. It doesn't.
Related: How California's CalEITC and Young Child Tax Credit Work - and Whether You Qualify · How California's Earned Income Tax Credits Work - and How to Claim CalEITC and the Young Child Tax Credit
What CalEITC Actually Is
The California Earned Income Tax Credit, known as CalEITC, is a refundable state credit administered by the Franchise Tax Board. Refundable means that if the credit exceeds what you owe in state income tax, the FTB sends you the difference as a refund. You don't need to owe taxes to benefit.
CalEITC is aimed at low- to moderate-income workers, including self-employed Californians, which is a significant difference from early versions of the credit that excluded the self-employed. As of the 2025 tax year, the FTB sets income limits and credit amounts that adjust periodically, so the specific dollar figures for any given year should be confirmed at ftb.ca.gov before you file. Generally, the credit phases in with earned income, peaks, then phases out, similar in structure to the federal EITC but with lower income thresholds and smaller maximum amounts.
You must have earned income from wages, salaries, or self-employment. Investment income is not earned income. You also need a valid Social Security number or, in some cases, an Individual Taxpayer Identification Number, though ITIN eligibility for CalEITC has expanded in recent years. California's credit is calculated separately from the federal credit, so claiming one doesn't automatically get you the other.
The Young Child Tax Credit
If you qualify for CalEITC and you have a child under age 6 as of December 31 of the tax year, you may also be eligible for the Young Child Tax Credit. This is an additional refundable credit on top of CalEITC, not a replacement for it. The maximum credit amount per return has been set at $1,117 in recent years, though the FTB adjusts this figure and you should verify the current amount at ftb.ca.gov for the specific tax year you're filing.
The child must be listed as a qualifying dependent on your return. The age cutoff is strict: if your child turns 6 before December 31 of the tax year, they don't qualify for that year's credit. One credit is available per tax return regardless of how many children under 6 you have.
How to Claim Both Credits
Both CalEITC and the Young Child Tax Credit are claimed on your California state income tax return using FTB Form 3514. You file this alongside your Form 540 or 540 2EZ. If you use commercial tax software, it will typically walk you through the CalEITC questions as part of the state return, but you should confirm the credit was actually calculated and attached before submitting.
The standard California personal income tax filing deadline for most taxpayers is April 15, which for the 2025 tax year fell on April 15, 2026. If you missed that deadline and haven't filed yet, you can still file a late return. Refundable credits like CalEITC don't disappear immediately just because you file late, but there are limits on how far back you can claim a refund, generally four years from the original due date of the return under California law. The FTB's website at ftb.ca.gov has current guidance on late filing and any penalty calculations.
See also: California's Earned Income Tax Credit: Who Qualifies and How to Claim It · How California's State Disability Insurance Works: Who Qualifies, What It Pays, and How to File
Californians who earned very little may also be eligible for free filing assistance through the FTB's CalFile program or through Volunteer Income Tax Assistance sites, many of which are available across the state.
Common Reasons People Miss These Credits
The most frequent reason qualifying Californians don't claim CalEITC is simply not knowing it exists separately from the federal credit. Others assume that because they didn't owe state taxes, there's nothing to file for, missing the refundable component entirely.
Self-employed workers sometimes skip the credit because earlier versions excluded them, but that's no longer the case. If you had net self-employment earnings, you may still qualify, though the FTB will want to see that income was properly reported on your return. Part-year California residents may also have CalEITC eligibility depending on how much of their income was earned while living in California, though the calculation gets more complicated and consulting the FTB's instructions or a tax professional makes sense in that situation.
This is general information, not legal or financial advice. Income limits, credit amounts, and eligibility rules for CalEITC and the Young Child Tax Credit change from year to year. Always verify current figures, deadlines, and qualifying rules directly with the California Franchise Tax Board at ftb.ca.gov before filing your return.