The Earned Income Tax Credit, EITC or EIC, is a benefit for working people who have what is considered to be a low to moderate income. To qualify for an EITC, there are certain criteria you need to meet, and you must file a tax return even if you don’t owe any taxes or are not required to file a tax return.
It can take time to file for EITC, but it can be worth it if you qualify, because it will reduce the amount of tax you owe and you might even get a refund.
How to Qualify
To qualify for EITC, you must have earned income from working for someone or from running or owning a business or farm. Eligibility will also be determined based on whether or not you have one or more qualifying children.
Making an error on your EITC return can lead to denial of your claim or delay in processing it. If your claim is denied, you would have to fill out a different form to try to overturn the decision to disallow you, which can be a lengthy process.
Earned income - This includes wages, tips, long-term disability, and/or income from self-employment. Forms of unearned income such as child support, alimony and combat pay are not included. Other special rules may apply:
The correct paperwork
Your SSN and those of your spouse and any children being claimed
The date of birth for everyone being claimed
Copies of last year's federal and state returns (you should keep up to 7 years of returns)
All income statements: Forms W-2 and 1099, and any business records related to your income from self-employment
All records of expenses, such as tuition, mortgage interest, or real estate taxes
If you own or run a business or farm, records of all your business-related expenses, organized by category. See https://www.irs.gov/businesses/small-businesses-self-employed/deducting-business-expenses for small business tax issues.
Dependent childcare information, including the name and address of paid caregivers, with their SSN or other tax identification number
The IRS website will allow you to file a basic return for free online. However, if you have a lot of income from different sources, and/or numerous deductions, it’s best to get either free help from a volunteer: