It is targeted at those with children and may give you a sizable refund. Originally this was for only two dependents, but since 2012, it has temporarily been increased to three or more dependents.
If you have three or more children you can claim a maximum tax credit of $5,891 with an adjusted gross income of less than $48,362 if you are married and filing jointly.
Children must qualify to be eligible for this credit by meeting these three tests:
Your child must be any of the following: Brother, sister, half brother, half sister, stepbrother, stepsister, son, daughter, stepchild, foster child or dependent.
Your child must be one of the following: Be aged under 19 and younger than you; be a full time student under 24 and younger than you; be permanently and totally disabled during the year.
Your child needs to have lived with you for more than half a year in the United States.
The maximum credit offered is as follows:
- No qualifying children - $475
- One qualifying child - $3,169
- Two qualifying children - $5,236
- Three qualifying children - $5,891
This will estimate how much credit you will receive and requires your filing status, annual income estimate, your state of residence and the number of qualifying children.
There have been many cases of fraud with the Earned Income Tax Credit however, as a result the IRS requires Form 8867 to be submitted with your income tax return.
If you think you are eligible to claim the earned income credit, then why not try TurboTax 2013 and let their online software do all the work for you.