Gross Income Deductions
Question: Earned Income Credit figured by adjusted gross income or regular income before deductions/adjustments?
Just an Example:
I made $10,000. My adjusted gross income is $9,000. Which of these are used to determine my EIC?
is the EIC based on your income before or after business expense deductions? thanks!
Answer: EIC has a different way of calculating income, neither of the ones you mentioned really apply.
You need to fill out the EIC worksheets to see if you qualify and where you fall.
(Given both of the numbers you offered, you’ll likely get a refundable credit, but you will need to send in the worksheets with your form. Don’t forget to do the “child tax credit” and the “additional child tax credit”. I know it’s a pain to do all these forms, but if you have only $10 k income and 1 or more kids, you are going to cash in on each one of these. They’re worth a lot of $$ to poor families!)
Corrections and clarifications
The following corrections and clarifications have been published by USA TODAY.
AGI Phaseouts (Tax Insight – Day Five)
