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H&rblock 36. H&rblock   Earned Income Credit (EIC) Table of Contents What's New Reminders Introduction Useful Items - You may want to see: Do You Qualify for the Credit?If Improper Claim Made in Prior Year Part A. H&rblock Rules for EveryoneRule 1. H&rblock Your AGI Must Be Less Than: Rule 2. H&rblock You Must Have a Valid Social Security Number (SSN) Rule 3. H&rblock Your Filing Status Cannot Be Married Filing Separately Rule 4. H&rblock You Must Be a U. H&rblock S. H&rblock Citizen or Resident Alien All Year Rule 5. H&rblock You Cannot File Form 2555 or Form 2555-EZ Rule 6. H&rblock Your Investment Income Must Be $3,300 or Less Rule 7. H&rblock You Must Have Earned Income Part B. H&rblock Rules If You Have a Qualifying ChildRule 8. H&rblock Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests Rule 9. H&rblock Your Qualifying Child Cannot Be Used By More Than One Person To Claim the EIC Rule 10. H&rblock You Cannot Be a Qualifying Child of Another Taxpayer Part C. H&rblock Rules If You Do Not Have a Qualifying ChildRule 11. H&rblock You Must Be at Least Age 25 but Under Age 65 Rule 12. H&rblock You Cannot Be the Dependent of Another Person Rule 13. H&rblock You Cannot Be a Qualifying Child of Another Taxpayer Rule 14. H&rblock You Must Have Lived in the United States More Than Half of the Year Part D. H&rblock Figuring and Claiming the EICRule 15. H&rblock Your Earned Income Must Be Less Than: IRS Will Figure the EIC for You How To Figure the EIC Yourself ExamplesExample 1. H&rblock John and Janet Smith (Form 1040A) Example 2. H&rblock Kelly Green (Form 1040EZ) What's New Earned income amount is more. H&rblock  The maximum amount of income you can earn and still get the credit has increased. H&rblock You may be able to take the credit if: You have three or more qualifying children and you earned less than $46,227 ($51,567 if married filing jointly), You have two qualifying children and you earned less than $43,038 ($48,378 if married filing jointly), You have one qualifying child and you earned less than $37,870 ($43,210 if married filing jointly), or You do not have a qualifying child and you earned less than $14,340 ($19,680 if married filing jointly). H&rblock Your adjusted gross income also must be less than the amount in the above list that applies to you. H&rblock For details, see Rules 1 and 15. H&rblock Investment income amount is more. H&rblock  The maximum amount of investment income you can have and still get the credit has increased to $3,300. H&rblock See Rule 6. H&rblock Reminders Increased EIC on certain joint returns. H&rblock  A married person filing a joint return may get more EIC than someone with the same income but a different filing status. H&rblock As a result, the EIC table has different columns for married persons filing jointly than for everyone else. H&rblock When you look up your EIC in the EIC Table, be sure to use the correct column for your filing status and the number of children you have. H&rblock Online help. H&rblock  You can use the EITC Assistant at www. H&rblock irs. H&rblock gov/eitc to find out if you are eligible for the credit. H&rblock The EITC Assistant is available in English and Spanish. H&rblock EIC questioned by IRS. H&rblock  The IRS may ask you to provide documents to prove you are entitled to claim the EIC. H&rblock We will tell you what documents to send us. H&rblock These may include: birth certificates, school records, medical records, etc. H&rblock The process of establishing your eligibility will delay your refund. H&rblock Introduction The earned income credit (EIC) is a tax credit for certain people who work and have less than $51,567 of earned income. H&rblock A tax credit usually means more money in your pocket. H&rblock It reduces the amount of tax you owe. H&rblock The EIC may also give you a refund. H&rblock How do you get the earned income credit?   To claim the EIC, you must: Qualify by meeting certain rules, and File a tax return, even if you: Do not owe any tax, Did not earn enough money to file a return, or Did not have income taxes withheld from your pay. H&rblock When you complete your return, you can figure your EIC by using a worksheet in the instructions for Form 1040, Form 1040A, or Form 1040EZ. H&rblock Or, if you prefer, you can let the IRS figure the credit for you. H&rblock How will this chapter help you?   This chapter will explain the following. H&rblock The rules you must meet to qualify for the EIC. H&rblock How to figure the EIC. H&rblock Useful Items - You may want to see: Publication 596 Earned Income Credit (EIC) Form (and Instructions) Schedule EIC Earned Income Credit (Qualifying Child Information) 8862 Information To Claim Earned Income Credit After Disallowance Do You Qualify for the Credit? To qualify to claim the EIC, you must first meet all of the rules explained in Part A, Rules for Everyone . H&rblock Then you must meet the rules in Part B, Rules If You Have a Qualifying Child , or Part C, Rules If You Do Not Have a Qualifying Child . H&rblock There is one final rule you must meet in Part D, Figuring and Claiming the EIC . H&rblock You qualify for the credit if you meet all the rules in each part that applies to you. H&rblock If you have a qualifying child, the rules in Parts A, B, and D apply to you. H&rblock If you do not have a qualifying child, the rules in Parts A, C, and D apply to you. H&rblock Table 36-1, Earned Income Credit in a Nutshell. H&rblock   Use Table 36–1 as a guide to Parts A, B, C, and D. H&rblock The table is a summary of all the rules in each part. H&rblock Do you have a qualifying child?   You have a qualifying child only if you have a child who meets the four tests described in Rule 8 and illustrated in Figure 36–1. H&rblock If Improper Claim Made in Prior Year If your EIC for any year after 1996 was denied or reduced for any reason other than a math or clerical error, you must attach a completed Form 8862 to your next tax return to claim the EIC. H&rblock You must also qualify to claim the EIC by meeting all the rules described in this chapter. H&rblock However, if your EIC was denied or reduced as a result of a math or clerical error, do not attach Form 8862 to your next tax return. H&rblock For example, if your arithmetic is incorrect, the IRS can correct it. H&rblock If you do not provide a correct social security number, the IRS can deny the EIC. H&rblock These kinds of errors are called math or clerical errors. H&rblock If your EIC for any year after 1996 was denied and it was determined that your error was due to reckless or intentional disregard of the EIC rules, then you cannot claim the EIC for the next 2 years. H&rblock If your error was due to fraud, then you cannot claim the EIC for the next 10 years. H&rblock More information. H&rblock   See chapter 5 in Publication 596 for more detailed information about the disallowance period and Form 8862. H&rblock Part A. H&rblock Rules for Everyone This part of the chapter discusses Rules 1 through 7. H&rblock You must meet all seven rules to qualify for the earned income credit. H&rblock If you do not meet all seven rules, you cannot get the credit and you do not need to read the rest of the chapter. H&rblock If you meet all seven rules in this part, then read either Part B or Part C (whichever applies) for more rules you must meet. H&rblock Rule 1. H&rblock Your AGI Must Be Less Than: $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children, $43,038 ($48,378 for married filing jointly) if you have two qualifying children, $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. H&rblock Adjusted gross income (AGI). H&rblock   AGI is the amount on line 38 (Form 1040), line 22 (Form 1040A), or line 4 (Form 1040EZ). H&rblock If your AGI is equal to or more than the applicable limit listed above, you cannot claim the EIC. H&rblock Example. H&rblock Your AGI is $38,550, you are single, and you have one qualifying child. H&rblock You cannot claim the EIC because your AGI is not less than $37,870. H&rblock However, if your filing status was married filing jointly, you might be able to claim the EIC because your AGI is less than $43,210. H&rblock Community property. H&rblock   If you are married, but qualify to file as head of household under special rules for married taxpayers living apart (see Rule 3 ), and live in a state that has community property laws, your AGI includes that portion of both your and your spouse's wages that you are required to include in gross income. H&rblock This is different from the community property rules that apply under Rule 7 . H&rblock Rule 2. H&rblock You Must Have a Valid Social Security Number (SSN) To claim the EIC, you (and your spouse, if filing a joint return) must have a valid SSN issued by the Social Security Administration (SSA). H&rblock Any qualifying child listed on Schedule EIC also must have a valid SSN. H&rblock (See Rule 8 if you have a qualifying child. H&rblock ) If your social security card (or your spouse's, if filing a joint return) says “Not valid for employment” and your SSN was issued so that you (or your spouse) could get a federally funded benefit, you cannot get the EIC. H&rblock An example of a federally funded benefit is Medicaid. H&rblock If you have a card with the legend “Not valid for employment” and your immigration status has changed so that you are now a U. H&rblock S. H&rblock citizen or permanent resident, ask the SSA for a new social security card without the legend. H&rblock U. H&rblock S. H&rblock citizen. H&rblock   If you were a U. H&rblock S. H&rblock citizen when you received your SSN, you have a valid SSN. H&rblock Valid for work only with INS or DHS authorization. H&rblock   If your social security card reads “Valid for work only with INS authorization” or “Valid for work only with DHS authorization,” you have a valid SSN, but only if that authorization is still valid. H&rblock SSN missing or incorrect. H&rblock   If an SSN for you or your spouse is missing from your tax return or is incorrect, you may not get the EIC. H&rblock Other taxpayer identification number. H&rblock   You cannot get the EIC if, instead of an SSN, you (or your spouse, if filing a joint return) have an individual taxpayer identification number (ITIN). H&rblock ITINs are issued by the Internal Revenue Service to noncitizens who cannot get an SSN. H&rblock No SSN. H&rblock   If you do not have a valid SSN, put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). H&rblock You cannot claim the EIC. H&rblock Getting an SSN. H&rblock   If you (or your spouse, if filing a joint return) do not have an SSN, you can apply for one by filing Form SS-5, Application for a Social Security Card, with the SSA. H&rblock You can get Form SS-5 online at www. H&rblock socialsecurity. H&rblock gov, from your local SSA office, or by calling the SSA at 1-800-772-1213. H&rblock Filing deadline approaching and still no SSN. H&rblock   If the filing deadline is approaching and you still do not have an SSN, you have two choices. H&rblock Request an automatic 6-month extension of time to file your return. H&rblock You can get this extension by filing Form 4868, Application for Automatic Extension of Time to File U. H&rblock S. H&rblock Individual Income Tax Return. H&rblock For more information, see chapter 1 . H&rblock File the return on time without claiming the EIC. H&rblock After receiving the SSN, file an amended return (Form 1040X, Amended U. H&rblock S. H&rblock Individual Income Tax Return) claiming the EIC. H&rblock Attach a filled-in Schedule EIC if you have a qualifying child. H&rblock Table 36-1. H&rblock Earned Income Credit in a Nutshell First, you must meet all the rules in this column. H&rblock Second, you must meet all the rules in one of these columns, whichever applies. H&rblock Third, you must meet the rule in this column. H&rblock Part A. H&rblock  Rules for Everyone Part B. H&rblock  Rules If You Have a Qualifying Child Part C. H&rblock  Rules If You Do Not Have a Qualifying Child Part D. H&rblock  Figuring and Claiming the EIC 1. H&rblock Your adjusted gross income (AGI) must be less than: • $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children,  • $43,038 ($48,378 for married filing jointly) if you have two qualifying children,  • $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or   • $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. H&rblock 2. H&rblock You must have a valid social security number. H&rblock  3. H&rblock Your filing status cannot be “Married filing separately. H&rblock ” 4. H&rblock You must be a U. H&rblock S. H&rblock citizen or resident alien all year. H&rblock  5. H&rblock You cannot file Form 2555 or Form 2555-EZ (relating to foreign earned income). H&rblock  6. H&rblock Your investment income must be $3,300 or less. H&rblock  7. H&rblock You must have earned income. H&rblock 8. H&rblock Your child must meet the relationship, age, residency, and joint return tests. H&rblock  9. H&rblock Your qualifying child cannot be used by more than one person to claim the EIC. H&rblock  10. H&rblock You cannot be a qualifying child of another person. H&rblock 11. H&rblock You must be at least age 25 but under age 65. H&rblock  12. H&rblock You cannot be the dependent of another person. H&rblock  13. H&rblock You cannot be a qualifying child of another person. H&rblock  14. H&rblock You must have lived in the United States more than half of the year. H&rblock 15. H&rblock Your earned income must be less than: • $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children,  • $43,038 ($48,378 for married filing jointly) if you have two qualifying children,  • $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or   • $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. H&rblock Rule 3. H&rblock Your Filing Status Cannot Be Married Filing Separately If you are married, you usually must file a joint return to claim the EIC. H&rblock Your filing status cannot be “Married filing separately. H&rblock ” Spouse did not live with you. H&rblock   If you are married and your spouse did not live in your home at any time during the last 6 months of the year, you may be able to file as head of household, instead of married filing separately. H&rblock In that case, you may be able to claim the EIC. H&rblock For detailed information about filing as head of household, see chapter 2 . H&rblock Rule 4. H&rblock You Must Be a U. H&rblock S. H&rblock Citizen or Resident Alien All Year If you (or your spouse, if married) were a nonresident alien for any part of the year, you cannot claim the earned income credit unless your filing status is married filing jointly. H&rblock You can use that filing status only if one spouse is a U. H&rblock S. H&rblock citizen or resident alien and you choose to treat the nonresident spouse as a U. H&rblock S. H&rblock resident. H&rblock If you make this choice, you and your spouse are taxed on your worldwide income. H&rblock If you (or your spouse, if married) were a nonresident alien for any part of the year and your filing status is not married filing jointly, enter “No” on the dotted line next to line 64a (Form 1040) or in the space to the left of line 38a (Form 1040A). H&rblock If you need more information on making this choice, get Publication 519, U. H&rblock S. H&rblock Tax Guide for Aliens. H&rblock Rule 5. H&rblock You Cannot File Form 2555 or Form 2555-EZ You cannot claim the earned income credit if you file Form 2555, Foreign Earned Income, or Form 2555-EZ, Foreign Earned Income Exclusion. H&rblock You file these forms to exclude income earned in foreign countries from your gross income, or to deduct or exclude a foreign housing amount. H&rblock U. H&rblock S. H&rblock possessions are not foreign countries. H&rblock See Publication 54, Tax Guide for U. H&rblock S. H&rblock Citizens and Resident Aliens Abroad, for more detailed information. H&rblock Rule 6. H&rblock Your Investment Income Must Be $3,300 or Less You cannot claim the earned income credit unless your investment income is $3,300 or less. H&rblock If your investment income is more than $3,300, you cannot claim the credit. H&rblock For most people, investment income is the total of the following amounts. H&rblock Taxable interest (line 8a of Form 1040 or 1040A). H&rblock Tax-exempt interest (line 8b of Form 1040 or 1040A). H&rblock Dividend income (line 9a of Form 1040 or 1040A). H&rblock Capital gain net income (line 13 of Form 1040, if more than zero, or line 10 of Form 1040A). H&rblock If you file Form 1040EZ, your investment income is the total of the amount of line 2 and the amount of any tax-exempt interest you wrote to the right of the words “Form 1040EZ” on line 2. H&rblock However, see Rule 6 in chapter 1 of Publication 596 if: You are filing Schedule E (Form 1040), Form 4797, or Form 8814, or You are reporting income from the rental of personal property on Form 1040, line 21. H&rblock Rule 7. H&rblock You Must Have Earned Income This credit is called the “earned income” credit because, to qualify, you must work and have earned income. H&rblock If you are married and file a joint return, you meet this rule if at least one spouse works and has earned income. H&rblock If you are an employee, earned income includes all the taxable income you get from your employer. H&rblock If you are self-employed or a statutory employee, you will figure your earned income on EIC Worksheet B in the instructions for Form 1040. H&rblock Earned Income Earned income includes all of the following types of income. H&rblock Wages, salaries, tips, and other taxable employee pay. H&rblock Employee pay is earned income only if it is taxable. H&rblock Nontaxable employee pay, such as certain dependent care benefits and adoption benefits, is not earned income. H&rblock But there is an exception for nontaxable combat pay, which you can choose to include in earned income, as explained below. H&rblock Net earnings from self-employment. H&rblock Gross income received as a statutory employee. H&rblock Wages, salaries, and tips. H&rblock   Wages, salaries, and tips you receive for working are reported to you on Form W-2, in box 1. H&rblock You should report these on line 1 (Form 1040EZ) or line 7 (Forms 1040A and 1040). H&rblock Nontaxable combat pay election. H&rblock   You can elect to include your nontaxable combat pay in earned income for the earned income credit. H&rblock Electing to include nontaxable combat pay in earned income may increase or decrease your EIC. H&rblock Figure the credit with and without your nontaxable combat pay before making the election. H&rblock   If you make the election, you must include in earned income all nontaxable combat pay you received. H&rblock If you are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election. H&rblock In other words, if one of you makes the election, the other one can also make it but does not have to. H&rblock   The amount of your nontaxable combat pay should be shown in box 12 of your Form W-2 with code “Q. H&rblock ” Self-employed persons and statutory employees. H&rblock   If you are self-employed or received income as a statutory employee, you must use the Form 1040 instructions to see if you qualify to get the EIC. H&rblock Approved Form 4361 or Form 4029 This section is for persons who have an approved: Form 4361, Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners, or Form 4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits. H&rblock Each approved form exempts certain income from social security taxes. H&rblock Each form is discussed here in terms of what is or is not earned income for the EIC. H&rblock Form 4361. H&rblock   Whether or not you have an approved Form 4361, amounts you received for performing ministerial duties as an employee count as earned income. H&rblock This includes wages, salaries, tips, and other taxable employee compensation. H&rblock A nontaxable housing allowance or the nontaxable rental value of a home is not earned income. H&rblock Also, amounts you received for performing ministerial duties, but not as an employee, do not count as earned income. H&rblock Examples include fees for performing marriages and honoraria for delivering speeches. H&rblock Form 4029. H&rblock   Whether or not you have an approved Form 4029, all wages, salaries, tips, and other taxable employee compensation count as earned income. H&rblock However, amounts you received as a self-employed individual do not count as earned income. H&rblock Also, in figuring earned income, do not subtract losses on Schedule C, C-EZ, or F from wages on line 7 of Form 1040. H&rblock Disability Benefits If you retired on disability, taxable benefits you receive under your employer's disability retirement plan are considered earned income until you reach minimum retirement age. H&rblock Minimum retirement age generally is the earliest age at which you could have received a pension or annuity if you were not disabled. H&rblock You must report your taxable disability payments on line 7 of either Form 1040 or Form 1040A until you reach minimum retirement age. H&rblock Beginning on the day after you reach minimum retirement age, payments you receive are taxable as a pension and are not considered earned income. H&rblock Report taxable pension payments on Form 1040, lines 16a and 16b (or Form 1040A, lines 12a and 12b). H&rblock Disability insurance payments. H&rblock   Payments you received from a disability insurance policy that you paid the premiums for are not earned income. H&rblock It does not matter whether you have reached minimum retirement age. H&rblock If this policy is through your employer, the amount may be shown in box 12 of your Form W-2 with code “J. H&rblock ” Income That Is Not Earned Income Examples of items that are not earned income include interest and dividends, pensions and annuities, social security and railroad retirement benefits (including disability benefits), alimony and child support, welfare benefits, workers' compensation benefits, unemployment compensation (insurance), nontaxable foster care payments, and veterans' benefits, including VA rehabilitation payments. H&rblock Do not include any of these items in your earned income. H&rblock Earnings while an inmate. H&rblock   Amounts received for work performed while an inmate in a penal institution are not earned income when figuring the earned income credit. H&rblock This includes amounts for work performed while in a work release program or while in a halfway house. H&rblock Workfare payments. H&rblock   Nontaxable workfare payments are not earned income for the EIC. H&rblock These are cash payments certain people receive from a state or local agency that administers public assistance programs funded under the federal Temporary Assistance for Needy Families (TANF) program in return for certain work activities such as (1) work experience activities (including remodeling or repairing public housing) if private sector employment is not available, or (2) community service program activities. H&rblock Community property. H&rblock   If you are married, but qualify to file as head of household under special rules for married taxpayers living apart (see Rule 3 ), and live in a state that has community property laws, your earned income for the EIC does not include any amount earned by your spouse that is treated as belonging to you under those laws. H&rblock That amount is not earned income for the EIC, even though you must include it in your gross income on your income tax return. H&rblock Your earned income includes the entire amount you earned, even if part of it is treated as belonging to your spouse under your state's community property laws. H&rblock Nevada, Washington, and California domestic partners. H&rblock   If you are a registered domestic partner in Nevada, Washington, or California, the same rules apply. H&rblock Your earned income for the EIC does not include any amount earned by your partner. H&rblock Your earned income includes the entire amount you earned. H&rblock For details, see Publication 555. H&rblock Conservation Reserve Program (CRP) payments. H&rblock   If you were receiving social security retirement benefits or social security disability benefits at the time you received any CRP payments, your CRP payments are not earned income for the EIC. H&rblock Nontaxable military pay. H&rblock   Nontaxable pay for members of the Armed Forces is not considered earned income for the EIC. H&rblock Examples of nontaxable military pay are combat pay, the Basic Allowance for Housing (BAH), and the Basic Allowance for Subsistence (BAS). H&rblock See Publication 3, Armed Forces' Tax Guide, for more information. H&rblock    Combat pay. H&rblock You can elect to include your nontaxable combat pay in earned income for the EIC. H&rblock See Nontaxable combat pay election, earlier. H&rblock Part B. H&rblock Rules If You Have a Qualifying Child If you have met all of the rules in Part A , read Part B to see if you have a qualifying child. H&rblock Part B discusses Rules 8 through 10. H&rblock You must meet all three of these rules, in addition to the rules in Parts A and D , to qualify for the earned income credit with a qualifying child. H&rblock You must file Form 1040 or Form 1040A to claim the EIC with a qualifying child. H&rblock (You cannot file Form 1040EZ. H&rblock ) You also must complete Schedule EIC and attach it to your return. H&rblock If you meet all the rules in Part A and this part, read Part D to find out what to do next. H&rblock If you do not meet Rule 8, you do not have a qualifying child. H&rblock Read Part C to find out if you can get the earned income credit without a qualifying child. H&rblock Rule 8. H&rblock Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests Your child is a qualifying child if your child meets four tests. H&rblock The four tests are: Relationship, Age, Residency, and Joint return. H&rblock The four tests are illustrated in Figure 36–1. H&rblock The paragraphs that follow contain more information about each test. H&rblock Relationship Test To be your qualifying child, a child must be your: Son, daughter, stepchild, foster child, or a descendant of any of them (for example, your grandchild), or Brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them (for example, your niece or nephew). H&rblock The following definitions clarify the relationship test. H&rblock Adopted child. H&rblock   An adopted child is always treated as your own child. H&rblock The term “adopted child” includes a child who was lawfully placed with you for legal adoption. H&rblock Foster child. H&rblock   For the EIC, a person is your foster child if the child is placed with you by an authorized placement agency or by judgement, decree, or other order of any court of competent jurisdiction. H&rblock An authorized placement agency includes a state or local government agency. H&rblock It also includes a tax-exempt organization licensed by a state. H&rblock In addition, it includes an Indian tribal government or an organization authorized by an Indian tribal government to place Indian children. H&rblock Example. H&rblock Debbie, who is 12 years old, was placed in your care 2 years ago by an authorized agency responsible for placing children in foster homes. H&rblock Debbie is your foster child. H&rblock Age Test Your child must be: Under age 19 at the end of 2013 and younger than you (or your spouse, if filing jointly), Under age 24 at the end of 2013, a student, and younger than you (or your spouse, if filing jointly), or Permanently and totally disabled at any time during 2013, regardless of age. H&rblock    The following examples and definitions clarify the age test. H&rblock Example 1—child not under age 19. H&rblock Your son turned 19 on December 10. H&rblock Unless he was permanently and totally disabled or a student, he is not a qualifying child because, at the end of the year, he was not under age 19. H&rblock Example 2—child not younger than you or your spouse. H&rblock Your 23-year-old brother, who is a full-time student and unmarried, lives with you and your spouse. H&rblock He is not disabled. H&rblock Both you and your spouse are 21 years old and you file a joint return. H&rblock Your brother is not your qualifying child because he is not younger than you or your spouse. H&rblock Example 3—child younger than your spouse but not younger than you. H&rblock The facts are the same as in Example 2 except that your spouse is 25 years old. H&rblock Because your brother is younger than your spouse, he is your qualifying child even though he is not younger than you. H&rblock Student defined. H&rblock   To qualify as a student, your child must be, during some part of each of any 5 calendar months during the calendar year: A full-time student at a school that has a regular teaching staff, course of study, and regular student body at the school, or A student taking a full-time, on-farm training course given by a school described in (1), or a state, county, or local government. H&rblock The 5 calendar months need not be consecutive. H&rblock   A full-time student is a student who is enrolled for the number of hours or courses the school considers to be full-time attendance. H&rblock School defined. H&rblock   A school can be an elementary school, junior or senior high school, college, university, or technical, trade, or mechanical school. H&rblock However, on-the-job training courses, correspondence schools, and schools offering courses only through the Internet do not count as schools for the EIC. H&rblock Vocational high school students. H&rblock   Students who work in co-op jobs in private industry as a part of a school's regular course of classroom and practical training are considered full-time students. H&rblock Permanently and totally disabled. H&rblock   Your child is permanently and totally disabled if both of the following apply. H&rblock He or she cannot engage in any substantial gainful activity because of a physical or mental condition. H&rblock A doctor determines the condition has lasted or can be expected to last continuously for at least a year or can lead to death. H&rblock Residency Test Your child must have lived with you in the United States for more than half of 2013. H&rblock The following definitions clarify the residency test. H&rblock United States. H&rblock   This means the 50 states and the District of Columbia. H&rblock It does not include Puerto Rico or U. H&rblock S. H&rblock possessions such as Guam. H&rblock Homeless shelter. H&rblock   Your home can be any location where you regularly live. H&rblock You do not need a traditional home. H&rblock For example, if your child lived with you for more than half the year in one or more homeless shelters, your child meets the residency test. H&rblock Military personnel stationed outside the United States. H&rblock    U. H&rblock S. H&rblock military personnel stationed outside the United States on extended active duty are considered to live in the United States during that duty period for purposes of the EIC. H&rblock Figure 36-1. H&rblock Tests for Qualifying Child Please click here for the text description of the image. H&rblock Qualifying child Extended active duty. H&rblock   Extended active duty means you are called or ordered to duty for an indefinite period or for a period of more than 90 days. H&rblock Once you begin serving your extended active duty, you are still considered to have been on extended active duty even if you do not serve more than 90 days. H&rblock Birth or death of a child. H&rblock   A child who was born or died in 2013 is treated as having lived with you for more than half of 2013 if your home was the child's home for more than half the time he or she was alive in 2013. H&rblock Temporary absences. H&rblock   Count time that you or your child is away from home on a temporary absence due to a special circumstance as time the child lived with you. H&rblock Examples of a special circumstance include illness, school attendance, business, vacation, military service, and detention in a juvenile facility. H&rblock Kidnapped child. H&rblock    A kidnapped child is treated as living with you for more than half of the year if the child lived with you for more than half the part of the year before the date of the kidnapping. H&rblock The child must be presumed by law enforcement authorities to have been kidnapped by someone who is not a member of your family or your child's family. H&rblock This treatment applies for all years until the child is returned. H&rblock However, the last year this treatment can apply is the earlier of: The year there is a determination that the child is dead, or The year the child would have reached age 18. H&rblock   If your qualifying child has been kidnapped and meets these requirements, enter “KC,” instead of a number, on line 6 of Schedule EIC. H&rblock Joint Return Test To meet this test, the child cannot file a joint return for the year. H&rblock Exception. H&rblock   An exception to the joint return test applies if your child and his or her spouse file a joint return only to claim a refund of income tax withheld or estimated tax paid. H&rblock Example 1—child files joint return. H&rblock You supported your 18-year-old daughter, and she lived with you all year while her husband was in the Armed Forces. H&rblock He earned $25,000 for the year. H&rblock The couple files a joint return. H&rblock Because your daughter and her husband filed a joint return, she is not your qualifying child. H&rblock Example 2—child files joint return only to claim a refund of withheld tax. H&rblock Your 18-year-old son and his 17-year-old wife had $800 of wages from part-time jobs and no other income. H&rblock They do not have a child. H&rblock Neither is required to file a tax return. H&rblock Taxes were taken out of their pay, so they filed a joint return only to get a refund of the withheld taxes. H&rblock The exception to the joint return test applies, so your son may be your qualifying child if all the other tests are met. H&rblock Example 3—child files joint return to claim American opportunity credit. H&rblock The facts are the same as in Example 2 except no taxes were taken out of your son's pay. H&rblock He and his wife are not required to file a tax return, but they file a joint return to claim an American opportunity credit of $124 and get a refund of that amount. H&rblock Because claiming the American opportunity credit is their reason for filing the return, they are not filing it only to get a refund of income tax withheld or estimated tax paid. H&rblock The exception to the joint return test does not apply, so your son is not your qualifying child. H&rblock Married child. H&rblock   Even if your child does not file a joint return, if your child was married at the end of the year, he or she cannot be your qualifying child unless: You can claim an exemption for the child, or The reason you cannot claim an exemption for the child is that you let the child's other parent claim the exemption under the Special rule for divorced or separated parents (or parents who live apart) , described later. H&rblock Social security number. H&rblock   The qualifying child must have a valid social security number (SSN) unless the child was born and died in 2013 and you attach to your return a copy of the child's birth certificate, death certificate, or hospital records showing a live birth. H&rblock You cannot claim the EIC on the basis of a qualifying child if: The qualifying child's SSN is missing from your tax return or is incorrect, The qualifying child's social security card says “Not valid for employment” and was issued for use in getting a federally funded benefit, or Instead of an SSN, the qualifying child has: An individual taxpayer identification number (ITIN), which is issued to a noncitizen who cannot get an SSN, or An adoption taxpayer identification number (ATIN), which is issued to adopting parents who cannot get an SSN for the child being adopted until the adoption is final. H&rblock   If you have more than one qualifying child and only one has a valid SSN, you can use only that child to claim the EIC. H&rblock For more information about SSNs, see Rule 2 . H&rblock Rule 9. H&rblock Your Qualifying Child Cannot Be Used By More Than One Person To Claim the EIC Sometimes a child meets the tests to be a qualifying child of more than one person. H&rblock However, only one of these persons can actually treat the child as a qualifying child. H&rblock Only that person can use the child as a qualifying child to take all of the following tax benefits (provided the person is eligible for each benefit). H&rblock The exemption for the child. H&rblock The child tax credit. H&rblock Head of household filing status. H&rblock The credit for child and dependent care expenses. H&rblock The exclusion for dependent care benefits. H&rblock The EIC. H&rblock The other person cannot take any of these benefits based on this qualifying child. H&rblock In other words, you and the other person cannot agree to divide these tax benefits between you. H&rblock The other person cannot take any of these tax benefits unless he or she has a different qualifying child. H&rblock The tiebreaker rules explained next explain who, if anyone, can claim the EIC when more than one person has the same qualifying child. H&rblock However, the tiebreaker rules do not apply if the other person is your spouse and you file a joint return. H&rblock Tiebreaker rules. H&rblock   To determine which person can treat the child as a qualifying child to claim the six tax benefits just listed, the following tiebreaker rules apply. H&rblock If only one of the persons is the child's parent, the child is treated as the qualifying child of the parent. H&rblock If the parents file a joint return together and can claim the child as a qualifying child, the child is treated as the qualifying child of the parents. H&rblock If the parents do not file a joint return together but both parents claim the child as a qualifying child, the IRS will treat the child as the qualifying child of the parent with whom the child lived for the longer period of time during the year. H&rblock If the child lived with each parent for the same amount of time, the IRS will treat the child as the qualifying child of the parent who had the higher adjusted gross income (AGI) for the year. H&rblock If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person who had the highest AGI for the year. H&rblock If a parent can claim the child as a qualifying child but no parent does so claim the child, the child is treated as the qualifying child of the person who had the highest AGI for the year, but only if that person's AGI is higher than the highest AGI of any of the child's parents who can claim the child. H&rblock If the child's parents file a joint return with each other, this rule can be applied by treating the parents' total AGI as divided evenly between them. H&rblock See Example 8 . H&rblock   Subject to these tiebreaker rules, you and the other person may be able to choose which of you claims the child as a qualifying child. H&rblock See Examples 1 through 13 . H&rblock   If you cannot claim the EIC because your qualifying child is treated under the tiebreaker rules as the qualifying child of another person for 2013, you may be able to take the EIC using a different qualifying child, but you cannot take the EIC using the rules in Part C for people who do not have a qualifying child. H&rblock If the other person cannot claim the EIC. H&rblock   If you and someone else have the same qualifying child but the other person cannot claim the EIC because he or she is not eligible or his or her earned income or AGI is too high, you may be able to treat the child as a qualifying child. H&rblock See Examples 6 and 7 . H&rblock But you cannot treat the child as a qualifying child to claim the EIC if the other person uses the child to claim any of the other six tax benefits listed earlier. H&rblock Examples. H&rblock The following examples may help you in determining whether you can claim the EIC when you and someone else have the same qualifying child. H&rblock Example 1. H&rblock You and your 2-year-old son Jimmy lived with your mother all year. H&rblock You are 25 years old, unmarried, and your AGI is $9,000. H&rblock Your only income was $9,000 from a part-time job. H&rblock Your mother's only income was $20,000 from her job, and her AGI is $20,000. H&rblock Jimmy's father did not live with you or Jimmy. H&rblock The special rule explained later for divorced or separated parents (or parents who live apart) does not apply. H&rblock Jimmy is a qualifying child of both you and your mother because he meets the relationship, age, residency, and joint return tests for both you and your mother. H&rblock However, only one of you can treat him as a qualifying child to claim the EIC (and the other tax benefits listed earlier for which that person qualifies). H&rblock He is not a qualifying child of anyone else, including his father. H&rblock If you do not claim Jimmy as a qualifying child for the EIC or any of the other tax benefits listed earlier, your mother can treat him as a qualifying child to claim the EIC (and any of the other tax benefits listed earlier for which she qualifies). H&rblock Example 2. H&rblock The facts are the same as in Example 1 except your AGI is $25,000. H&rblock Because your mother's AGI is not higher than yours, she cannot claim Jimmy as a qualifying child. H&rblock Only you can claim him. H&rblock Example 3. H&rblock The facts are the same as in Example 1 except that you and your mother both claim Jimmy as a qualifying child. H&rblock In this case, you as the child's parent will be the only one allowed to claim Jimmy as a qualifying child for the EIC and the other tax benefits listed earlier for which you qualify. H&rblock The IRS will disallow your mother's claim to the EIC and any of the other tax benefits listed earlier unless she has another qualifying child. H&rblock Example 4. H&rblock The facts are the same as in Example 1 except that you also have two other young children who are qualifying children of both you and your mother. H&rblock Only one of you can claim each child. H&rblock However, if your mother's AGI is higher than yours, you can allow your mother to claim one or more of the children. H&rblock For example, if you claim one child, your mother can claim the other two. H&rblock Example 5. H&rblock The facts are the same as in Example 1 except that you are only 18 years old. H&rblock This means you are a qualifying child of your mother. H&rblock Because of Rule 10 , discussed next, you cannot claim the EIC and cannot claim Jimmy as a qualifying child. H&rblock Only your mother may be able to treat Jimmy as a qualifying child to claim the EIC. H&rblock If your mother meets all the other requirements for claiming the EIC and you do not claim Jimmy as a qualifying child for any of the other tax benefits listed earlier, your mother can claim both you and Jimmy as qualifying children for the EIC. H&rblock Example 6. H&rblock The facts are the same as in Example 1 except that your mother earned $50,000 from her job. H&rblock Because your mother's earned income is too high for her to claim the EIC, only you can claim the EIC using your son. H&rblock Example 7. H&rblock The facts are the same as in Example 1 except that you earned $50,000 from your job and your AGI is $50,500. H&rblock Your earned income is too high for you to claim the EIC. H&rblock But your mother cannot claim the EIC either, because her AGI is not higher than yours. H&rblock Example 8. H&rblock The facts are the same as in Example 1 except that you and Jimmy's father are married to each other, live with Jimmy and your mother, and have an AGI of $30,000 on a joint return. H&rblock If you and your husband do not claim Jimmy as a qualifying child for the EIC or any of the other tax benefits listed earlier, your mother can claim him instead. H&rblock Even though the AGI on your joint return, $30,000, is more than your mother's AGI of $20,000, for this purpose half of the joint AGI can be treated as yours and half as your husband's. H&rblock In other words, each parent's AGI can be treated as $15,000. H&rblock Example 9. H&rblock You, your husband, and your 10-year-old son Joey lived together until August 1, 2013, when your husband moved out of the household. H&rblock In August and September, Joey lived with you. H&rblock For the rest of the year, Joey lived with your husband, who is Joey's father. H&rblock Joey is a qualifying child of both you and your husband because he lived with each of you for more than half the year and because he met the relationship, age, and joint return tests for both of you. H&rblock At the end of the year, you and your husband still were not divorced, legally separated, or separated under a written separation agreement, so the special rule for divorced or separated parents (or parents who live apart) does not apply. H&rblock You and your husband will file separate returns. H&rblock Your husband agrees to let you treat Joey as a qualifying child. H&rblock This means, if your husband does not claim Joey as a qualifying child for any of the tax benefits listed earlier, you can claim him as a qualifying child for any tax benefit listed earlier for which you qualify. H&rblock However, your filing status is married filing separately, so you cannot claim the EIC or the credit for child and dependent care expenses. H&rblock See Rule 3 . H&rblock Example 10. H&rblock The facts are the same as in Example 9 except that you and your husband both claim Joey as a qualifying child. H&rblock In this case, only your husband will be allowed to treat Joey as a qualifying child. H&rblock This is because, during 2013, the boy lived with him longer than with you. H&rblock You cannot claim the EIC (either with or without a qualifying child). H&rblock However, your husband's filing status is married filing separately, so he cannot claim the EIC or the credit for child and dependent care expenses. H&rblock See Rule 3 . H&rblock Example 11. H&rblock You, your 5-year-old son and your son's father lived together all year. H&rblock You and your son's father are not married. H&rblock Your son is a qualifying child of both you and his father because he meets the relationship, age, residency, and joint return tests for both you and his father. H&rblock Your earned income and AGI are $12,000, and your son's father's earned income and AGI are $14,000. H&rblock Neither of you had any other income. H&rblock Your son's father agrees to let you treat the child as a qualifying child. H&rblock This means, if your son's father does not claim your son as a qualifying child for the EIC or any of the other tax benefits listed earlier, you can claim him as a qualifying child for the EIC and any of the other tax benefits listed earlier for which you qualify. H&rblock Example 12. H&rblock The facts are the same as in Example 11 except that you and your son's father both claim your son as a qualifying child. H&rblock In this case, only your son's father will be allowed to treat your son as a qualifying child. H&rblock This is because his AGI, $14,000, is more than your AGI, $12,000. H&rblock You cannot claim the EIC (either with or without a qualifying child). H&rblock Example 13. H&rblock You and your 7-year-old niece, your sister's child, lived with your mother all year. H&rblock You are 25 years old, and your AGI is $9,300. H&rblock Your only income was from a part-time job. H&rblock Your mother's AGI is $15,000. H&rblock Her only income was from her job. H&rblock Your niece's parents file jointly, have an AGI of less than $9,000, and do not live with you or their child. H&rblock Your niece is a qualifying child of both you and your mother because she meets the relationship, age, residency, and joint return tests for both you and your mother. H&rblock However, only your mother can treat her as a qualifying child. H&rblock This is because your mother's AGI, $15,000, is more than your AGI, $9,300. H&rblock Special rule for divorced or separated parents (or parents who live apart). H&rblock   A child will be treated as the qualifying child of his or her noncustodial parent (for purposes of claiming an exemption and the child tax credit, but not for the EIC) if all of the following statements are true. H&rblock The parents: Are divorced or legally separated under a decree of divorce or separate maintenance, Are separated under a written separation agreement, or Lived apart at all times during the last 6 months of 2013, whether or not they are or were married. H&rblock The child received over half of his or her support for the year from the parents. H&rblock The child is in the custody of one or both parents for more than half of 2013. H&rblock Either of the following statements is true. H&rblock The custodial parent signs Form 8332 or a substantially similar statement that he or she will not claim the child as a dependent for the year, and the noncustodial parent attaches the form or statement to his or her return. H&rblock If the divorce decree or separation agreement went into effect after 1984 and before 2009, the noncustodial parent may be able to attach certain pages from the decree or agreement instead of Form 8332. H&rblock A pre-1985 decree of divorce or separate maintenance or written separation agreement that applies to 2013 provides that the noncustodial parent can claim the child as a dependent, and the noncustodial parent provides at least $600 for support of the child during 2013. H&rblock  For details, see chapter 3. H&rblock Also see Applying Rule 9 to divorced or separated parents (or parents who live apart) , next. H&rblock Applying Rule 9 to divorced or separated parents (or parents who live apart). H&rblock   If a child is treated as the qualifying child of the noncustodial parent under the special rule just described for children of divorced or separated parents (or parents who live apart), only the noncustodial parent can claim an exemption and the child tax credit for the child. H&rblock However, the custodial parent, if eligible, or another eligible taxpayer can claim the child as a qualifying child for the EIC and other tax benefits listed earlier in this chapter. H&rblock If the child is the qualifying child of more than one person for these benefits, then the tiebreaker rules determine which person can treat the child as a qualifying child. H&rblock Example 1. H&rblock You and your 5-year-old son lived all year with your mother, who paid the entire cost of keeping up the home. H&rblock Your AGI is $10,000. H&rblock Your mother’s AGI is $25,000. H&rblock Your son's father did not live with you or your son. H&rblock Under the special rule for children of divorced or separated parents (or parents who live apart), your son is treated as the qualifying child of his father, who can claim an exemption and the child tax credit for the child. H&rblock However, your son's father cannot claim your son as a qualifying child for head of household filing status, the credit for child and dependent care expenses, the exclusion for dependent care benefits, or the EIC. H&rblock You and your mother did not have any child care expenses or dependent care benefits. H&rblock If you do not claim your son as a qualifying child, your mother can claim him as a qualifying child for the EIC and head of household filing status, if she qualifies for these tax benefits. H&rblock Example 2. H&rblock The facts are the same as in Example 1 except that your AGI is $25,000 and your mother's AGI is $21,000. H&rblock Your mother cannot claim your son as a qualifying child for any purpose because her AGI is not higher than yours. H&rblock Example 3. H&rblock The facts are the same as in Example 1 except that you and your mother both claim your son as a qualifying child for the EIC. H&rblock Your mother also claims him as a qualifying child for head of household filing status. H&rblock You as the child's parent will be the only one allowed to claim your son as a qualifying child for the EIC. H&rblock The IRS will disallow your mother's claim to the EIC and head of household filing status unless she has another qualifying child. H&rblock Rule 10. H&rblock You Cannot Be a Qualifying Child of Another Taxpayer You are a qualifying child of another taxpayer (your parent, guardian, foster parent, etc. H&rblock ) if all of the following statements are true. H&rblock You are that person's son, daughter, stepchild, foster child, or a descendant of any of them. H&rblock Or, you are that person's brother, sister, half brother, half sister, stepbrother, or stepsister (or a descendant of any of them). H&rblock You were: Under age 19 at the end of the year and younger than that person (or that person's spouse, if the person files jointly), Under age 24 at the end of the year, a student, and younger than that person (or that person's spouse, if the person files jointly), or Permanently and totally disabled, regardless of age. H&rblock You lived with that person in the United States for more than half of the year. H&rblock You are not filing a joint return for the year (or are filing a joint return only to claim a refund of withheld income tax or estimated tax paid). H&rblock For more details about the tests to be a qualifying child, see Rule 8 . H&rblock If you are a qualifying child of another taxpayer, you cannot claim the EIC. H&rblock This is true even if the person for whom you are a qualifying child does not claim the EIC or meet all of the rules to claim the EIC. H&rblock Put “No” beside line 64a (Form 1040) or line 38a (Form 1040A). H&rblock Example. H&rblock You and your daughter lived with your mother all year. H&rblock You are 22 years old, unmarried, and attended a trade school full time. H&rblock You had a part-time job and earned $5,700. H&rblock You had no other income. H&rblock Because you meet the relationship, age, residency, and joint return tests, you are a qualifying child of your mother. H&rblock She can claim the EIC if she meets all the other requirements. H&rblock Because you are your mother's qualifying child, you cannot claim the EIC. H&rblock This is so even if your mother cannot or does not claim the EIC. H&rblock Child of person not required to file a return. H&rblock   You are not the qualifying child of another taxpayer (and so may qualify to claim the EIC) if the person for whom you meet the relationship, age, residency, and joint return tests is not required to file an income tax return and either: Does not file an income tax return, or Files a return only to get a refund of income tax withheld or estimated tax paid. H&rblock Example. H&rblock The facts are the same as in the last example except your mother had no gross income, is not required to file a 2013 tax return, and does not file a 2013 tax return. H&rblock As a result, you are not your mother's qualifying child. H&rblock You can claim the EIC if you meet all the other requirements to do so. H&rblock   See Rule 10 in Publication 596 for additional examples. H&rblock Part C. H&rblock Rules If You Do Not Have a Qualifying Child Read this part if you: Do not have a qualifying child, and Have met all the rules in Part A . H&rblock  Part C discusses Rules 11 through 14. H&rblock You must meet all four of these rules, in addition to the rules in Parts A and D , to qualify for the earned income credit without a qualifying child. H&rblock If you have a qualifying child, the rules in this part do not apply to you. H&rblock You can claim the credit only if you meet all the rules in Parts A, B, and D. H&rblock See Rule 8 to find out if you have a qualifying child. H&rblock Rule 11. H&rblock You Must Be at Least Age 25 but Under Age 65 You must be at least age 25 but under age 65 at the end of 2013. H&rblock If you are married filing a joint return, either you or your spouse must be at least age 25 but under age 65 at the end of 2013. H&rblock It does not matter which spouse meets the age test, as long as one of the spouses does. H&rblock You meet the age test if you were born after December 31, 1948, and before January 2, 1989. H&rblock If you are married filing a joint return, you meet the age test if either you or your spouse was born after December 31, 1948, and before January 2, 1989. H&rblock If neither you nor your spouse meets the age test, you cannot claim the EIC. H&rblock Put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). H&rblock Death of spouse. H&rblock   If you are filing a joint return with your spouse who died in 2013, you meet the age test if your spouse was at least age 25 but under age 65 at the time of death. H&rblock Example 1. H&rblock You are age 28 and unmarried. H&rblock You meet the age test. H&rblock Example 2—spouse meets age test. H&rblock You are married and filing a joint return. H&rblock You are age 23 and your spouse is age 27. H&rblock You meet the age test because your spouse is at least age 25 but under age 65. H&rblock Example 3—spouse dies in 2013. H&rblock You are married and filing a joint return with your spouse who died in August 2013. H&rblock You are age 67. H&rblock Your spouse would have become age 65 in November 2013. H&rblock Because your spouse was under age 65 when she died, you meet the age test. H&rblock Rule 12. H&rblock You Cannot Be the Dependent of Another Person If you are not filing a joint return, you meet this rule if: You checked box 6a on Form 1040 or 1040A, or You did not check the “You” box on line 5 of Form 1040EZ, and you entered $10,000 on that line. H&rblock If you are filing a joint return, you meet this rule if: You checked both box 6a and box 6b on Form 1040 or 1040A, or You and your spouse did not check either the “You” box or the “Spouse” box on line 5 of Form 1040EZ, and you entered $20,000 on that line. H&rblock If you are not sure whether someone else can claim you (or your spouse, if filing a joint return) as a dependent, read the rules for claiming a dependent in chapter 3. H&rblock If someone else can claim you (or your spouse, if filing a joint return) as a dependent on his or her return, but does not, you still cannot claim the credit. H&rblock Example 1. H&rblock In 2013, you were age 25, single, and living at home with your parents. H&rblock You worked and were not a student. H&rblock You earned $7,500. H&rblock Your parents cannot claim you as a dependent. H&rblock When you file your return, you claim an exemption for yourself by not checking the “You” box on line 5 of your Form 1040EZ and by entering $10,000 on that line. H&rblock You meet this rule. H&rblock You can claim the EIC if you meet all the other requirements. H&rblock Example 2. H&rblock The facts are the same as in Example 1 , except that you earned $2,000. H&rblock Your parents can claim you as a dependent but decide not to. H&rblock You do not meet this rule. H&rblock You cannot claim the credit because your parents could have claimed you as a dependent. H&rblock Joint returns. H&rblock   You generally cannot be claimed as a dependent by another person if you are married and file a joint return. H&rblock   However, another person may be able to claim you as a dependent if you and your spouse file a joint return only to get a refund of income tax withheld or estimated tax paid. H&rblock But neither you nor your spouse can be claimed as a dependent by another person if you claim the EIC on your joint return. H&rblock Example 1. H&rblock You are 26 years old. H&rblock You and your wife live with your parents and had $800 of wages from part-time jobs and no other income. H&rblock Neither you nor your wife is required to file a tax return. H&rblock You do not have a child. H&rblock Taxes were taken out of your pay, so you file a joint return only to get a refund of the withheld taxes. H&rblock Your parents are not disqualified from claiming an exemption for you just because you filed a joint return. H&rblock They can claim exemptions for you and your wife if all the other tests to do so are met. H&rblock Example 2. H&rblock The facts are the same as in Example 1 except no taxes were taken out of your pay. H&rblock Also, you and your wife are not required to file a tax return, but you file a joint return to claim an EIC of $63 and get a refund of that amount. H&rblock Because claiming the EIC is your reason for filing the return, you are not filing it only to get a refund of income tax withheld or estimated tax paid. H&rblock Your parents cannot claim an exemption for either you or your wife. H&rblock Rule 13. H&rblock You Cannot Be a Qualifying Child of Another Taxpayer You are a qualifying child of another taxpayer (your parent, guardian, foster parent, etc. H&rblock ) if all of the following statements are true. H&rblock You are that person's son, daughter, stepchild, foster child, or a descendant of any of them. H&rblock Or, you are that person's brother, sister, half brother, half sister, stepbrother, or stepsister (or a descendant of any of them). H&rblock You were: Under age 19 at the end of the year and younger than that person (or that person's spouse, if the person files jointly), Under age 24 at the end of the year, a student (as defined in Rule 8 ), and younger than that person (or that person's spouse, if the person files jointly), or Permanently and totally disabled, regardless of age. H&rblock You lived with that person in the United States for more than half of the year. H&rblock You are not filing a joint return for the year (or are filing a joint return only to claim a refund of withheld income tax or estimated tax paid). H&rblock For more details about the tests to be a qualifying child, see Rule 8 . H&rblock If you are a qualifying child of another taxpayer, you cannot claim the EIC. H&rblock This is true even if the person for whom you are a qualifying child does not claim the EIC or meet all of the rules to claim the EIC. H&rblock Put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). H&rblock Example. H&rblock You lived with your mother all year. H&rblock You are age 26, unmarried, and permanently and totally disabled. H&rblock Your only income was from a community center where you went three days a week to answer telephones. H&rblock You earned $5,000 for the year and provided more than half of your own support. H&rblock Because you meet the relationship, age, residency, and joint return tests, you are a qualifying child of your mother for the EIC. H&rblock She can claim the EIC if she meets all the other requirements. H&rblock Because you are a qualifying child of your mother, you cannot claim the EIC. H&rblock This is so even if your mother cannot or does not claim the EIC. H&rblock Joint returns. H&rblock   You generally cannot be a qualifying child of another taxpayer if you are married and file a joint return. H&rblock   However, you may be a qualifying child of another taxpayer if you and your spouse file a joint return for the year only to get a refund of income tax withheld or estimated tax paid. H&rblock But neither you nor your spouse can be a qualifying child of another taxpayer if you claim the EIC on your joint return. H&rblock Child of person not required to file a return. H&rblock   You are not the qualifying child of another taxpayer (and so may qualify to claim the EIC) if the person for whom you meet the relationship, age, residency, and joint return tests is not required to file an income tax return and either: Does not file an income tax return, or Files a return only to get a refund of income tax withheld or estimated tax paid. H&rblock Example. H&rblock You lived all year with your father. H&rblock You are 27 years old, unmarried, permanently and totally disabled, and earned $13,000. H&rblock You have no other income, no children, and provided more than half of your own support. H&rblock Your father had no gross income, is not required to file a 2013 tax return, and does not file a 2013 tax return. H&rblock As a result, you are not your father's qualifying child. H&rblock You can claim the EIC if you meet all the other requirements to do so. H&rblock   See Rule 13 in Publication 596 for additional examples. H&rblock Rule 14. H&rblock You Must Have Lived in the United States More Than Half of the Year Your home (and your spouse's, if filing a joint return) must have been in the United States for more than half the year. H&rblock If it was not, put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). H&rblock United States. H&rblock   This means the 50 states and the District of Columbia. H&rblock It does not include Puerto Rico or U. H&rblock S. H&rblock possessions such as Guam. H&rblock Homeless shelter. H&rblock   Your home can be any location where you regularly live. H&rblock You do not need a traditional home. H&rblock If you lived in one or more homeless shelters in the United States for more than half the year, you meet this rule. H&rblock Military personnel stationed outside the United States. H&rblock   U. H&rblock S. H&rblock military personnel stationed outside the United States on extended active duty (defined in Rule 8 ) are considered to live in the United States during that duty period for purposes of the EIC. H&rblock Part D. H&rblock Figuring and Claiming the EIC Read this part if you have met all the rules in Parts A and B, or all the rules in Parts A and C. H&rblock Part D discusses Rule 15 . H&rblock You must meet this rule, in addition to the rules in Parts A and B , or Parts A and C , to qualify for the earned income credit. H&rblock This part of the chapter also explains how to figure the amount of your credit. H&rblock You have two choices. H&rblock Have the IRS figure the EIC for you. H&rblock If you want to do this, see IRS Will Figure the EIC for You . H&rblock Figure the EIC yourself. H&rblock If you want to do this, see How To Figure the EIC Yourself . H&rblock Rule 15. H&rblock Your Earned Income Must Be Less Than: $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children, $43,038 ($48,378 for married filing jointly) if you have two qualifying children, $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. H&rblock Earned income generally means wages, salaries, tips, other taxable employee pay, and net earnings from self-employment. H&rblock Employee pay is earned income only if it is taxable. H&rblock Nontaxable employee pay, such as certain dependent care benefits and adoption benefits, is not earned income. H&rblock But there is an exception for nontaxable combat pay, which you can choose to include in earned income. H&rblock Earned income is explained in detail in Rule 7 . H&rblock Figuring earned income. H&rblock   If you are self-employed, a statutory employee, or a member of the clergy or a church employee who files Schedule SE (Form 1040), you will figure your earned income when you fill out Part 4 of EIC Worksheet B in the Form 1040 instructions. H&rblock   Otherwise, figure your earned income by using the worksheet in Step 5 of the Form 1040 instructions for lines 64a and 64b or the Form 1040A instructions for lines 38a and 38b, or the worksheet in Step 2 of the Form 1040EZ instructions for lines 8a and 8b. H&rblock   When using one of those worksheets to figure your earned income, you will start with the amount on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ). H&rblock You will then reduce that amount by any amount included on that line and described in the following list: Scholarship or fellowship grants not reported on a Form W-2, Inmate's income, and Pension or annuity from deferred compensation plans. H&rblock Scholarship or fellowship grants not reported on a Form W-2. H&rblock   A scholarship or fellowship grant that was not reported to you on a Form W-2 is not considered earned income for the earned income credit. H&rblock Inmate's income. H&rblock   Amounts received for work performed while an inmate in a penal institution are not earned income for the earned income credit. H&rblock This includes amounts received for work performed while in a work release program or while in a halfway house. H&rblock If you received any amount for work done while an inmate in a penal institution and that amount is included in the total on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ), put “PRI” and the amount on the dotted line next to line 7 (Form 1040), in the space to the left of the entry space for line 7 (Form 1040A), or in the space to the left of line 1 (Form 1040EZ). H&rblock Pension or annuity from deferred compensation plans. H&rblock   A pension or annuity from a nonqualified deferred compensation plan or a nongovernmental section 457 plan is not considered earned income for the earned income credit. H&rblock If you received such an amount and it was included in the total on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ), put “DFC” and the amount on the dotted line next to line 7 (Form 1040), in the space to the left of the entry space for line 7 (Form 1040A), or in the space to the left of line 1 (Form 1040EZ). H&rblock This amount may be reported in box 11 of your Form W-2. H&rblock If you received such an amount but box 11 is blank, contact your employer for the amount received as a pension or annuity. H&rblock Clergy. H&rblock   If you are a member of the clergy who files Schedule SE and the amount on line 2 of that schedule includes an amount that was also reported on line 7 (Form 1040), subtract that amount from the amount on line 7 (Form 1040) and enter the result in the first space of the worksheet in Step 5 of the Form 1040 instructions for lines 64a and 64b. H&rblock Put “Clergy” on the dotted line next to line 64a (Form 1040). H&rblock Church employees. H&rblock    A church employee means an employee (other than a minister or member of a religious order) of a church or qualified church-controlled organization that is exempt from employer social security and Medicare taxes. H&rblock If you received wages as a
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