More information about the Earned Income Credit. Guide to Legal Help. Which tax credits use this definition? The Four Tests Relationship Test To meet the relationship test, a child must be your: child sibling step-sibling a descendent of one of these relatives like nieces, nephews, grandchildren, etc. Adopted children and foster children both fall under 'child. Age Test To meet the age test, the child must be: Under age 19 at the end of the year and younger than you or your spouse, if your file jointly , A studentunder age 24 at the end of the year and younger than you or your spouse, if you file jointly , or Permanently and totally disabled at any time during the year, no matter what age.
A student is any child who, during any 5 months of the year: Was enrolled as a full-time student at a school, or Took a full-time on-farm training course from a school or a state, county, or local government agency. Residency Test The child must live with you. Some examples of reasons why a child isn't living at home are: school vacation medical care military service detention in a juvenile facility A child who was born or died during the year is counted as living with you for the entire year if your home was the child's home for the entire time they were alive.
Support Test You must have supported the child financially. Qualifying Child of more than one person Sometimes a child meets the tests to be a qualifying child of more than one person. Tie-Breaker Rule When more than one person could claim a child as a qualifying child, the IRS uses these rules to decide who will be able to claim the child on their taxes.
Maria and Felix are U. They claim their daughter, Penelope also a citizen , 6, as a dependent. Marie and Felix also claim a daughter from a previous marriage, Sofia, 12, who was living in Mexico but came to live with them. Yes, as Penelope is a U. No, because Sofia does not have a valid SSN. Paul and Lauren are in the process of adopting a child, Lilly. She has been placed with the couple, but the adoption is not yet final.
Kai and Zehra are studying in the U. They also have two children in the U. They cannot claim the EITC. The qualifying child claimed must be younger than the taxpayer or totally and permanently disabled. Lauren is enrolled in college full-time. Because he is not attending school full-time, she cannot claim him.
This is so even if Pam can claim Patrick as a dependent qualifying relative. A man lives with his girlfriend and her child. To be considered full-time, the student must have enrolled for the number of hours or courses their school considers to be full-time attendance. Students who work on "co-op" jobs in private industry as a part of a school's official program are also considered full-time students.
Adopted Child Definition. Foster Child Definition. To be a qualifying child for the EITC, your child must live in the same home as you in the United States for more than half of the tax year.
Be sure to ask your tax preparer to run the numbers both ways. You don't have to have a child in order to claim the earned income credit. The earned income tax credit doesn't just cut the amount of tax you owe — the EITC could also score you a refund, and in some cases, a refund that's more than what you actually paid in taxes. Below are the maximum earned income tax credit amounts, plus the max you can earn before losing the benefit altogether.
Max AGI, single or head of household filers. Both your earned income and your adjusted gross income each have to be below the levels in the table. In general, the less you earn, the larger the earned income credit. Your earned income usually includes job wages, salary, tips and other taxable pay you get from your employer.
Your adjusted gross income is your earned income minus certain deductions. Besides staying below the income thresholds noted above, there are other qualification rules and requirements. Here are the big eligibility rules, but you can also check out our quiz below for a quick read on whether you might qualify for the earned income tax credit. You also must have not lived with your spouse during the last six months or you must have a separation agreement or decree.
There are special EIC rules for members of the military and the clergy, as well as for people who have disability income or who have children with disabilities.
If you claim one or more children as part of your earned income credit, each must pass certain tests to qualify:.
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