What is Earned Income Tax Credit? How Do You Apply?
The ordinary American is now paying more than they should for everything as inflation continues to harm millions of people around the United States.
Earned Income Tax Credit (EITC) is a labour credit that lowers or refunds federal taxes for low and moderate income employees.
The following requirements must be satisfied, according to the IRS website, in order to qualify for the EITC.
1. Have a job with a salary of less than $57,414
2. Have investment income that is less than $10,000 in the 2021 tax year.
3. Possess a valid Social Security number by the time your 2021 tax return is due.
4. Being an American citizen or a resident alien all year long.
5. Don't submit Form 2555
What is considered earned income?
The essence of the EITC is that you are qualified for a rebate as long as you have worked.
This could be a job, self-employment, union strike benefits or disability payments you received before the minimum retirement age.
The following are not considered earned income according to the IRS website:
1. Pay you received for tasks you performed while you were a prisoner
2. Dividends and interest
3. Annuities or pensions
4. Unemployment compensation
4. Social Security.
5. Unemployment compensation
7. Child support.