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EARNED INCOME TAX CREDIT (EIC/EITC)
The following is primarily summarized from information about the Earned Income Tax Credit posted on the Internal Revenue Service (IRS) website: www.irs.gov/individuals/article/0,,id=96406,00.html
WHAT IS THE EARNED INCOME TAX CREDIT?
The Earned Income Tax Credit (EITC), or Earned Income Credit (EIC), is a tax benefit for working people with low or moderate incomes. The EITC/EIC is designed to reduce the tax burden on eligible income workers and to supplement their wages. Workers who qualify for the EIC and file a federal tax return can have some or all of the federal income tax that was taken out of their pay during the year refunded to them. Workers whose earnings are too small to have paid taxes can also obtain an EITC/EIC. The EITC/EIC also reduces any additional taxes eligible workers may owe.
WHO IS ELIGIBLE FOR THE EARNED INCOME CREDIT?
Single or married people who worked full time or part time at some point in 2007 can qualify for the EITC/EIC under the following guidelines:
- Workers who were raising one child in their home and had family income of less than $33,241 ($35,241 for married workers) in 2007 can get an EITC/EIC of up to $2,853.
- Workers who were raising more than one child in their home and had family income of less than $37,783 ($39,283 for married workers) can get an EITC/EIC of up to $4,716.
- Workers who were not raising children in their home and had income below $12,590 ($14,590 for married workers) can get an EITC/EIC of up to $428.
Children who can be claimed for the EITC/EIC include sons, daughters, stepchildren, grandchildren, adopted, and foster children as long as they have lived with the worker for more than half of the year. Brothers, sisters, stepbrothers, stepsisters, nieces or nephews can be claimed as foster children if they lived with the worker for more than half of the year and were raised as family members. Children must be under age 19 or under age 24, if full-time students for at least five months of the year. Permanently and totally disabled children of any age may also qualify for an EITC/EIC claim. Also, the child must not have provided more than half of his/her support for the year.
Many legal immigrants can also qualify for the EITC/EIC, as long as they meet the eligibility requirements. In most cases, the EITC/EIC does not affect eligibility for other benefits received by the worker such as cash assistance ("welfare"), Medicaid, SNAP/Food Stamps, SSI, or public or subsidized housing. However, undocumented workers cannot claim an EITC/EIC.
HOW TO OBTAIN AN EARNED INCOME CREDIT
Workers who raised children in 2007 must file either Form 1040 or 1040A and must fill out and attach Schedule EIC. Workers with children cannot get the EITC/EIC if they file form 1040EZ or fail to attach Schedule EIC. Married workers must file a joint return to get the EITC/EIC. Workers who were not raising children in 2007 can file any tax form - including the 1040EZ. These workers write "EIC" (or the dollar amount of their credit) on the Earned Income Credit line on the tax form. They do not need to file Schedule EIC. Schedule EIC forms can be obtained by mail or downloaded from the website of the IRS: www.irs.gov Forms can also be obtained at libraries, post offices and local IRS offices.
FORMS TO BRING TO A TAX ASSISTANCE SITE
When visiting a TCE (Tax Counseling for the Elderly) or VITA (Volunteer Income Tax Assistance) site, bring the following:
- All W-2 forms for household
- 1099 Forms (if any)
- Social Security Card(s) or Individual Taxpayer ID Number(s) for all household members
- Last Year's Tax Return (if you have one)
- Child care provider name, address and tax ID number
- Education expenses and student loan information
- For direct deposit, a check or savings account number with routing number
- Copies of payments to municipalities (local property taxes such as automobiles) for state tax returns
- Any other tax-related documents you have received
TO FIND PROVIDERS IN CONNECTICUT'S COMMUNITY RESOURCES DATABASE:
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SOURCES: 2-1-1 database; Internal Revenue Service website
INTERNET PAGE PREPARED BY: 211/pt
CONTENT LAST REVIEWED: January2008
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