The Earned Income Credit

The earned income credit is a special Federal tax benefit for working people with modest incomes. It is used to be fair to families with children. But even those without children who are between 25 and 64 years of age may qualify for a small credit.

Getting the credit is not difficult. You must file a Federal income tax return, however. If you’re raising children, file form 1040 or 1040A and attach a Schedule EIC. If you’re not raising children, you can file form 1040, 1040A, or 1040EZ and write EIC on the Earned Income Credit line of the tax form. If you qualify for the EIC, you’ll either owe less in taxes or get a check back from the IRS. You can even get the credit if you owe no Federal income tax.

Want to know more? For details about the rules concerning eligibility of the Earned Income Credit, check the instructions that come with the 1040, 1040A and 1040EZ tax forms. Or you can call the IRS at the following number - 1-800-829-1040. IRS publication 596 is the most comprehensive source of information, however.

Many families that apply for the Earned Income Credit pay someone to complete their tax forms. Paying for tax preparation takes away from the value of the EIC. But workers with a modest income can get free help preparing their tax return. To find a free tax preparation site near you, call the IRS at 1-800-829-1040. This is an automated telephone line for the Internal Revenue Service. Hold on the line till you can speak to an operator and ask for the listing of free tax preparation sites in your area.

Kansas taxpayers also need to check their Kansas Individual Income Tax booklet for information about the new State Earned Income Credit. Put some extra cash in your pocket. Check out the Earned Income Credit!

Resource: A Project of the Center On Budget and Policy Priorities. Earned Income Credit Campaign, 1998.

Carole Bozworth, BozworthC@missouri.edu
Regional Specialist, Consumer and Family Economics
Jackson County, MO
University of Missouri Extension