Good time: credit for behavior
Good time (also called good conduct time) is awarded for not breaking prison rules. In the federal system, people serving more than one year can get up to 54 days for each year of the sentence the court imposed, if the Bureau of Prisons finds "exemplary compliance" with the rules.[1] Life sentences are excluded.[1]
Earned time: credit for programs and work
Earned time (also called program credit, earned credit or earned release time) is awarded for taking part in approved programs. Under the federal First Step Act, eligible people earn 10 days of time credits for every 30 days of successful participation in recidivism-reduction programs or productive activities. People found to be minimum or low risk can earn 5 more days.[2]
Why the names are confusing
States use these words differently. Some call all credit "good time." Others split good time, work credit, education credit and meritorious credit. Some credits shorten the sentence itself. Others only move up parole eligibility. The only reliable way to know is to read your state's rules.