Earned Income Credit

Earned Income CreditWhat is Earned Income Credit?
The Earned Income Credit provides up to $5,751 to low income individuals and families. 

How much Earned Income Credit can I recieve?
The amount of credit you are entitled to depends upon how much income you have and the number of children you have. The American Recovery and Reinvestment Act (ARRA) provides a temporary increase in EITC and expands the credit for workers with three or more qualifying children. These changes are temporary and apply to tax years 2009-2012.

Can I claim Earned Income Credit?
Look to the chart below for the number of qualifying children you have to see if you might qualify for the Earned Income Credit.

What happens if someone else claims my child for Earned Income Credit?
IRS laws decide who can claim a child for Earned Income Credit.  If you and another person qualify to claim the same child, then tie-breaker rules decide who can claim the child and claim Earned Income Credit. 

Tie-breaker rules can be difficult to understand and the relationships of various individuals in a household can create a situation that requires the advise of a tax professional experienced with Earned Income Credit and custodial arrangements between divorced or separated parents.  

When more than one person appears to qualify for Earned Income Credit with the same child, we strongly recommend both you and the other person meet with one of our experienced tax professionals to discuss your tax situation.

No Children

Even if you have no children, you may qualify for up to $457 of EITC, if you meet the following rules:

  • Your income must be less than $13,660 ($18,740 married filing jointly)
  • You must have a valid Social Security Number
  • You must have earned income from employment, self-employment or another source
  • Your filing status cannot be married, filing separately
  • You must be a U.S. citizen or resident alien all year, or a nonresident alien married to a U.S. citizen or resident alien filing a joint return
  • You cannot be the qualifying child of another person
  • If you do not have a qualifying child, you must:
    • be age 25 but under 65 at the end of the year,
    • live in the United States for more than half the year, and
    • not qualify as a dependent of another person
  • Cannot file Form 2555 or 2555-EZ (related to foreign earned income)
  • For 2011, your  investment income must be $3,150 or less.

1  Qualifying  Child

You may qualify to receive up to $3,094 of Earned Income Credit if you meet the following rules:

  • Your income must me less than $36,052 ($41,132 married filing jointly)
  • You (your spouse, if married) and your child must have valid Social Security Numbers
  • You must have earned income from employment, self-employment or another source
  • Your filing status cannot be married, filing separately
  • You cannot be the qualifying child of another person
  • You and your child must have lived in the United States for more than half the year
  • You cannot qualify as a dependent of another person
  • You cannot file Form 2555 or 2555-EZ (related to foreign earned income)
  • For 2011, your  investment income must be $3,150 or less.

2 Qualifying Children

You may qualify to receive up to $5,112 of Earned Income Credit if you meet the following rules:

  • Your income must be less than $40,964 ($46,044 if married filing jointly)
  • You (your spouse, if married) and each child you claim for Earned Income Credit must have a valid Social Security Number
  • You must have earned income from employment, self-employment or another source
  • Your filing status cannot be married, filing separately
  • You cannot be the qualifying child of another person
  • You and your child must have lived in the United States for more than half the year
  • You cannot qualify as a dependent of another person
  • You cannot file Form 2555 or 2555-EZ (related to foreign earned income)
  • For 2011, your  investment income must be $3,150 or less.

3 or More Qualifying Children

You may qualify to receive up to $5,657 of Earned Income Credit if you meet the following rules:

  • Your income must be less than $43,998 ($48,078 if married filing jointly)
  • You (your spouse, if married) and each child you claim for Earned Income Credit must have a valid Social Security Number
  • You must have earned income from employment, self-employment or another source
  • Your filing status cannot be married, filing separately
  • You cannot be the qualifying child of another person
  • You and your child must have lived in the United States for more than half the year
  • You cannot qualify as a dependent of another person
  • You cannot file Form 2555 or 2555-EZ (related to foreign earned income)
  • For 2011, your  investment income must be $3,150 or less.