This is a guest post from Becky House, who is associated with American Financial Solutions.
Life’s expensive. That’s why, if you make less than $48,279, it’s smart to find out about the Earned Income Tax Credit.
One of the largest benefit programs for working families is also one of the most overlooked. It’s called the Earned Income Tax Credit (EITC) and, as the name implies, it’s for people who work for a living but don’t make a lot of money.
Rural residents, self-employed people such as farmers, childless workers and grandparents raising grandchildren are among those who may be eligible, but often fail to claim EITC. You could receive a credit of up to $5,657 when you file your 2009 taxes. If you are owed a refund, this credit would increase the amount you receive. If you owe taxes, the credit may lower or eliminate the amount of tax you have to pay. You could use this money to catch up on bills, build up your savings or open a bank account.
In addition you:
- Must have a valid social security number for each individual listed on your tax return.
- Must have earned income from employment or from self-employment.
- Cannot file taxes using the “married filing separately,” status.
- Must be a U.S. citizen or resident alien all year, or a nonresident alien married to a U.S. citizen or resident alien and filing a joint tax return.
- Cannot be a 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 U.S. for more than half of the year.
- Not qualify as a dependent of another person.
It is clear to see how EITC can make life a little easier in these hard times. A married couple with three children and an income ranging from $12,570 to $21,420 could be eligible for the maximum tax credit of $5,657. Taxpayers making as much as $48,279 could qualify for EITC and can get tax returns prepared for no charge at a Volunteer Income Tax Assistance site or AARP Tax Assistance site in their local community. Many communities offer 211 or 311 telephone numbers to locate vital services. If not, you can call the IRS volunteer assistance locator number at 1-800-906-9887 to locate free tax assistance in your community.
Source: Internal Revenue Service, Final Breathe Easier. http://www.eitc.irs.gov/public/site_files/FINAL_BREATH_EASIER_7x10_local.pdf
American Financial Solutions is a non-profit credit counseling agency that provides counseling and financial education services to consumers. The text version of the attached article is below for your review. If you have questions or would like to speak to us regarding our financial educational materials including our online class series, “Investing In Yourself”, please visit our website at www.myfinancialgoals.org or contact Becky House, Education Manager for American Financial Solutions, at 1-800-894-3946.