When you file your taxes, the hope is often that you can get the most possible money back. And the Earned Income Tax Credit, or EITC, may be able to help.
Some people don’t have to file a tax return. If your income for the previous year is less than the standard deduction plus one exemption, and you aren’t a dependent to another taxpayer, then you don’t need to file a federal tax return.
But, even if you don’t owe any tax or aren’t required to file a return, there might be enough money left on the table to warrant filing. Depending on your income and your number of dependents, the EITC could be worth as much as $6,242.
So who qualifies for this tax credit?
According to the IRS, this following types of people qualify:
- If your Adjusted Gross Income (AGI) is less than $14,820 and you’re single.
- If you’re married filing jointly and your AGI is less than $20,330.
- If you have three or more kids and are married, your AGI limit can be as high as $53,267.
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For example, say you filed a joint return with your spouse and you have three children. If you made $20,000, but your spouse does not work and you don’t have any other deductions, you’d receive the full amount of $6,242.
If you made $40,000, but contributed $5,500 to an IRA, you’d receive $2,789 in Earned Income Tax Credit. (This is still assuming you’re married filing jointly with three children.)
To see if you qualify for the earned income tax credit, take the assessment on the IRS website here.