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Many taxpayers don’t realize they could benefit from the earned income tax credit

by | Feb 3, 2020 | Uncategorized | 0 comments

The earned income tax credit benefits millions of taxpayers who qualify by putting more money in their pockets. This money can help with things like food, gas, clothing and even saving for a rainy day.

Here’s some information for people who often miss out on claiming the credit:

Native Americans:

As with all taxpayers, Native Americans can claim the credit if they meet basic rules.

Taxpayers must have earned income. In other words, they must receive income as an employee, or from owning or operating their own business.This includes home-based businesses and work in the service industry, construction and farming.

Grandparents:

Grandparents who work and are also raising grandchildren can also benefit from the EITC. These individuals who are caring for their grandchildren should find out if they qualify. It’s important because they’re often not aware they could claim these children for the EITC.

The EITC is a refundable tax credit. This means those who qualify and claim the credit could pay less federal tax, pay no tax, or even get a tax refund. Grandparents who are the primary caretakers of their grandchildren – as with all taxpayers – should remember these facts about the credit:

A grandparent who works and has a qualifying child may be eligible for the EITC, even if the grandparent is 65 years of age or older.The grandchild must meet the qualifying child requirements for EITC. Special rules and restrictions apply if the child’s parents or other family members also qualify for EITC. Eligible grandparents must file a tax return and claim the credit, even if they don’t owe any tax or aren’t required to file.

Taxpayers living in rural areas:

Many taxpayers living in small towns and rural areas may qualify for EITC. Here are some things that people living in these areas should know about the credit and how it can benefit them:

EITC is a refundable tax credit. This means those who qualify and claim the credit could pay less federal tax, pay no tax, or even get a tax refund.To get the credit, taxpayers must file a tax return and claim the credit, even if they don’t owe any tax or aren’t required to file.Unmarried workers without a qualifying child who earn less than $15,570 may qualify for a smaller amount of the credit.

If you would like to know more about how the EITC can benefit you, please contact S. D. Hogan & Company | Certified Public Accountants at info@sdhogan.net or (757) 777-3672.


Reprinted with the permission of the IRS.

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