Earned Income Credit reduces tax burden

All Things Legal

By Jane M. Winand, Legal Assistance Attorney

The Earned Income Credit is a special tax benefit for taxpayers who earned a low or moderate income.

It serves an important purpose because it reduces the tax burden incurred by these taxpayers and helps to supplement their wages. Taxpayers who qualify for the EIC and file a federal tax return can get back some, if not all, of the federal income tax taken out of their pay during the year.

They also may get extra cash back from the IRS. So even taxpayers whose earnings are too small to owe income tax can still get the EIC.

Who can get the EIC and how much is it worth?

  • Single or married people who worked full time or part time at some point in 2016, have a Social Security number, and have at least some earned income may qualify for the EIC, depending on the amount of that income.
  • Taxpayers who were raising one child in their home and had a family income of less than $39,296 (or $44,846 for married filing jointly) in 2016 can get an EIC of up to $3,373.
  • Taxpayers who were raising two children in their home and had a family income of less than $44,648 (or $50,198 for married filed jointly) in 2016 can get an EIC of up to $5,572.00.
  • Taxpayers who were not raising children in their home, were between ages 25 and 65 on Dec. 31, 2016, and had an income below $14,880 (or $20,430 for married filed jointly) can get an EIC up to $506.

What is a qualifying child for the EIC?

  • Sons, daughters, stepchildren, grandchildren and adopted children
  • Brothers, sisters, half-brothers, half-sisters, stepbrothers or stepsisters, as well as descendants of such relatives — if they were cared for as members of the family
  • Foster children who are placed with the taxpayer by an authorized government or private placement agency
  • “Qualifying children” must have lived with the taxpayer for more than half of the year. They must also be under the age of 19 or under the age of 24 if they are full-time students.
  • Totally and permanently disabled children of any age also may be qualifying children.
  • A valid Social Security number is required for every qualifying child by the due date of the 2016 tax return.

The Fort Meade Joint Installation Tax Center is available to assist service members, retirees and their family members with free federal and state income tax preparation and electronic filing. The Tax Center is located at 4217 Morrison St., first floor, Office of the Staff Judge Advocate.

To schedule an appointment, call the Tax Center at 301-677-9366.

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