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File 2007 Taxes Online

File 2007 taxes online 36. File 2007 taxes online   Earned Income Credit (EIC) Table of Contents What's New Reminders Introduction Useful Items - You may want to see: Do You Qualify for the Credit?If Improper Claim Made in Prior Year Part A. File 2007 taxes online Rules for EveryoneRule 1. File 2007 taxes online Your AGI Must Be Less Than: Rule 2. File 2007 taxes online You Must Have a Valid Social Security Number (SSN) Rule 3. File 2007 taxes online Your Filing Status Cannot Be Married Filing Separately Rule 4. File 2007 taxes online You Must Be a U. File 2007 taxes online S. File 2007 taxes online Citizen or Resident Alien All Year Rule 5. File 2007 taxes online You Cannot File Form 2555 or Form 2555-EZ Rule 6. File 2007 taxes online Your Investment Income Must Be $3,300 or Less Rule 7. File 2007 taxes online You Must Have Earned Income Part B. File 2007 taxes online Rules If You Have a Qualifying ChildRule 8. File 2007 taxes online Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests Rule 9. File 2007 taxes online Your Qualifying Child Cannot Be Used By More Than One Person To Claim the EIC Rule 10. File 2007 taxes online You Cannot Be a Qualifying Child of Another Taxpayer Part C. File 2007 taxes online Rules If You Do Not Have a Qualifying ChildRule 11. File 2007 taxes online You Must Be at Least Age 25 but Under Age 65 Rule 12. File 2007 taxes online You Cannot Be the Dependent of Another Person Rule 13. File 2007 taxes online You Cannot Be a Qualifying Child of Another Taxpayer Rule 14. File 2007 taxes online You Must Have Lived in the United States More Than Half of the Year Part D. File 2007 taxes online Figuring and Claiming the EICRule 15. File 2007 taxes online Your Earned Income Must Be Less Than: IRS Will Figure the EIC for You How To Figure the EIC Yourself ExamplesExample 1. File 2007 taxes online John and Janet Smith (Form 1040A) Example 2. File 2007 taxes online Kelly Green (Form 1040EZ) What's New Earned income amount is more. File 2007 taxes online  The maximum amount of income you can earn and still get the credit has increased. File 2007 taxes online You may be able to take the credit if: You have three or more qualifying children and you earned less than $46,227 ($51,567 if married filing jointly), You have two qualifying children and you earned less than $43,038 ($48,378 if married filing jointly), You have one qualifying child and you earned less than $37,870 ($43,210 if married filing jointly), or You do not have a qualifying child and you earned less than $14,340 ($19,680 if married filing jointly). File 2007 taxes online Your adjusted gross income also must be less than the amount in the above list that applies to you. File 2007 taxes online For details, see Rules 1 and 15. File 2007 taxes online Investment income amount is more. File 2007 taxes online  The maximum amount of investment income you can have and still get the credit has increased to $3,300. File 2007 taxes online See Rule 6. File 2007 taxes online Reminders Increased EIC on certain joint returns. File 2007 taxes online  A married person filing a joint return may get more EIC than someone with the same income but a different filing status. File 2007 taxes online As a result, the EIC table has different columns for married persons filing jointly than for everyone else. File 2007 taxes online When you look up your EIC in the EIC Table, be sure to use the correct column for your filing status and the number of children you have. File 2007 taxes online Online help. File 2007 taxes online  You can use the EITC Assistant at www. File 2007 taxes online irs. File 2007 taxes online gov/eitc to find out if you are eligible for the credit. File 2007 taxes online The EITC Assistant is available in English and Spanish. File 2007 taxes online EIC questioned by IRS. File 2007 taxes online  The IRS may ask you to provide documents to prove you are entitled to claim the EIC. File 2007 taxes online We will tell you what documents to send us. File 2007 taxes online These may include: birth certificates, school records, medical records, etc. File 2007 taxes online The process of establishing your eligibility will delay your refund. File 2007 taxes online Introduction The earned income credit (EIC) is a tax credit for certain people who work and have less than $51,567 of earned income. File 2007 taxes online A tax credit usually means more money in your pocket. File 2007 taxes online It reduces the amount of tax you owe. File 2007 taxes online The EIC may also give you a refund. File 2007 taxes online How do you get the earned income credit?   To claim the EIC, you must: Qualify by meeting certain rules, and File a tax return, even if you: Do not owe any tax, Did not earn enough money to file a return, or Did not have income taxes withheld from your pay. File 2007 taxes online When you complete your return, you can figure your EIC by using a worksheet in the instructions for Form 1040, Form 1040A, or Form 1040EZ. File 2007 taxes online Or, if you prefer, you can let the IRS figure the credit for you. File 2007 taxes online How will this chapter help you?   This chapter will explain the following. File 2007 taxes online The rules you must meet to qualify for the EIC. File 2007 taxes online How to figure the EIC. File 2007 taxes online Useful Items - You may want to see: Publication 596 Earned Income Credit (EIC) Form (and Instructions) Schedule EIC Earned Income Credit (Qualifying Child Information) 8862 Information To Claim Earned Income Credit After Disallowance Do You Qualify for the Credit? To qualify to claim the EIC, you must first meet all of the rules explained in Part A, Rules for Everyone . File 2007 taxes online Then you must meet the rules in Part B, Rules If You Have a Qualifying Child , or Part C, Rules If You Do Not Have a Qualifying Child . File 2007 taxes online There is one final rule you must meet in Part D, Figuring and Claiming the EIC . File 2007 taxes online You qualify for the credit if you meet all the rules in each part that applies to you. File 2007 taxes online If you have a qualifying child, the rules in Parts A, B, and D apply to you. File 2007 taxes online If you do not have a qualifying child, the rules in Parts A, C, and D apply to you. File 2007 taxes online Table 36-1, Earned Income Credit in a Nutshell. File 2007 taxes online   Use Table 36–1 as a guide to Parts A, B, C, and D. File 2007 taxes online The table is a summary of all the rules in each part. File 2007 taxes online Do you have a qualifying child?   You have a qualifying child only if you have a child who meets the four tests described in Rule 8 and illustrated in Figure 36–1. File 2007 taxes online If Improper Claim Made in Prior Year If your EIC for any year after 1996 was denied or reduced for any reason other than a math or clerical error, you must attach a completed Form 8862 to your next tax return to claim the EIC. File 2007 taxes online You must also qualify to claim the EIC by meeting all the rules described in this chapter. File 2007 taxes online However, if your EIC was denied or reduced as a result of a math or clerical error, do not attach Form 8862 to your next tax return. File 2007 taxes online For example, if your arithmetic is incorrect, the IRS can correct it. File 2007 taxes online If you do not provide a correct social security number, the IRS can deny the EIC. File 2007 taxes online These kinds of errors are called math or clerical errors. File 2007 taxes online If your EIC for any year after 1996 was denied and it was determined that your error was due to reckless or intentional disregard of the EIC rules, then you cannot claim the EIC for the next 2 years. File 2007 taxes online If your error was due to fraud, then you cannot claim the EIC for the next 10 years. File 2007 taxes online More information. File 2007 taxes online   See chapter 5 in Publication 596 for more detailed information about the disallowance period and Form 8862. File 2007 taxes online Part A. File 2007 taxes online Rules for Everyone This part of the chapter discusses Rules 1 through 7. File 2007 taxes online You must meet all seven rules to qualify for the earned income credit. File 2007 taxes online If you do not meet all seven rules, you cannot get the credit and you do not need to read the rest of the chapter. File 2007 taxes online If you meet all seven rules in this part, then read either Part B or Part C (whichever applies) for more rules you must meet. File 2007 taxes online Rule 1. File 2007 taxes online Your AGI Must Be Less Than: $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children, $43,038 ($48,378 for married filing jointly) if you have two qualifying children, $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. File 2007 taxes online Adjusted gross income (AGI). File 2007 taxes online   AGI is the amount on line 38 (Form 1040), line 22 (Form 1040A), or line 4 (Form 1040EZ). File 2007 taxes online If your AGI is equal to or more than the applicable limit listed above, you cannot claim the EIC. File 2007 taxes online Example. File 2007 taxes online Your AGI is $38,550, you are single, and you have one qualifying child. File 2007 taxes online You cannot claim the EIC because your AGI is not less than $37,870. File 2007 taxes online However, if your filing status was married filing jointly, you might be able to claim the EIC because your AGI is less than $43,210. File 2007 taxes online Community property. File 2007 taxes online   If you are married, but qualify to file as head of household under special rules for married taxpayers living apart (see Rule 3 ), and live in a state that has community property laws, your AGI includes that portion of both your and your spouse's wages that you are required to include in gross income. File 2007 taxes online This is different from the community property rules that apply under Rule 7 . File 2007 taxes online Rule 2. File 2007 taxes online You Must Have a Valid Social Security Number (SSN) To claim the EIC, you (and your spouse, if filing a joint return) must have a valid SSN issued by the Social Security Administration (SSA). File 2007 taxes online Any qualifying child listed on Schedule EIC also must have a valid SSN. File 2007 taxes online (See Rule 8 if you have a qualifying child. File 2007 taxes online ) If your social security card (or your spouse's, if filing a joint return) says “Not valid for employment” and your SSN was issued so that you (or your spouse) could get a federally funded benefit, you cannot get the EIC. File 2007 taxes online An example of a federally funded benefit is Medicaid. File 2007 taxes online If you have a card with the legend “Not valid for employment” and your immigration status has changed so that you are now a U. File 2007 taxes online S. File 2007 taxes online citizen or permanent resident, ask the SSA for a new social security card without the legend. File 2007 taxes online U. File 2007 taxes online S. File 2007 taxes online citizen. File 2007 taxes online   If you were a U. File 2007 taxes online S. File 2007 taxes online citizen when you received your SSN, you have a valid SSN. File 2007 taxes online Valid for work only with INS or DHS authorization. File 2007 taxes online   If your social security card reads “Valid for work only with INS authorization” or “Valid for work only with DHS authorization,” you have a valid SSN, but only if that authorization is still valid. File 2007 taxes online SSN missing or incorrect. File 2007 taxes online   If an SSN for you or your spouse is missing from your tax return or is incorrect, you may not get the EIC. File 2007 taxes online Other taxpayer identification number. File 2007 taxes online   You cannot get the EIC if, instead of an SSN, you (or your spouse, if filing a joint return) have an individual taxpayer identification number (ITIN). File 2007 taxes online ITINs are issued by the Internal Revenue Service to noncitizens who cannot get an SSN. File 2007 taxes online No SSN. File 2007 taxes online   If you do not have a valid SSN, put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). File 2007 taxes online You cannot claim the EIC. File 2007 taxes online Getting an SSN. File 2007 taxes online   If you (or your spouse, if filing a joint return) do not have an SSN, you can apply for one by filing Form SS-5, Application for a Social Security Card, with the SSA. File 2007 taxes online You can get Form SS-5 online at www. File 2007 taxes online socialsecurity. File 2007 taxes online gov, from your local SSA office, or by calling the SSA at 1-800-772-1213. File 2007 taxes online Filing deadline approaching and still no SSN. File 2007 taxes online   If the filing deadline is approaching and you still do not have an SSN, you have two choices. File 2007 taxes online Request an automatic 6-month extension of time to file your return. File 2007 taxes online You can get this extension by filing Form 4868, Application for Automatic Extension of Time to File U. File 2007 taxes online S. File 2007 taxes online Individual Income Tax Return. File 2007 taxes online For more information, see chapter 1 . File 2007 taxes online File the return on time without claiming the EIC. File 2007 taxes online After receiving the SSN, file an amended return (Form 1040X, Amended U. File 2007 taxes online S. File 2007 taxes online Individual Income Tax Return) claiming the EIC. File 2007 taxes online Attach a filled-in Schedule EIC if you have a qualifying child. File 2007 taxes online Table 36-1. File 2007 taxes online Earned Income Credit in a Nutshell First, you must meet all the rules in this column. File 2007 taxes online Second, you must meet all the rules in one of these columns, whichever applies. File 2007 taxes online Third, you must meet the rule in this column. File 2007 taxes online Part A. File 2007 taxes online  Rules for Everyone Part B. File 2007 taxes online  Rules If You Have a Qualifying Child Part C. File 2007 taxes online  Rules If You Do Not Have a Qualifying Child Part D. File 2007 taxes online  Figuring and Claiming the EIC 1. File 2007 taxes online Your adjusted gross income (AGI) must be less than: • $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children,  • $43,038 ($48,378 for married filing jointly) if you have two qualifying children,  • $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or   • $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. File 2007 taxes online 2. File 2007 taxes online You must have a valid social security number. File 2007 taxes online  3. File 2007 taxes online Your filing status cannot be “Married filing separately. File 2007 taxes online ” 4. File 2007 taxes online You must be a U. File 2007 taxes online S. File 2007 taxes online citizen or resident alien all year. File 2007 taxes online  5. File 2007 taxes online You cannot file Form 2555 or Form 2555-EZ (relating to foreign earned income). File 2007 taxes online  6. File 2007 taxes online Your investment income must be $3,300 or less. File 2007 taxes online  7. File 2007 taxes online You must have earned income. File 2007 taxes online 8. File 2007 taxes online Your child must meet the relationship, age, residency, and joint return tests. File 2007 taxes online  9. File 2007 taxes online Your qualifying child cannot be used by more than one person to claim the EIC. File 2007 taxes online  10. File 2007 taxes online You cannot be a qualifying child of another person. File 2007 taxes online 11. File 2007 taxes online You must be at least age 25 but under age 65. File 2007 taxes online  12. File 2007 taxes online You cannot be the dependent of another person. File 2007 taxes online  13. File 2007 taxes online You cannot be a qualifying child of another person. File 2007 taxes online  14. File 2007 taxes online You must have lived in the United States more than half of the year. File 2007 taxes online 15. File 2007 taxes online Your earned income must be less than: • $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children,  • $43,038 ($48,378 for married filing jointly) if you have two qualifying children,  • $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or   • $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. File 2007 taxes online Rule 3. File 2007 taxes online Your Filing Status Cannot Be Married Filing Separately If you are married, you usually must file a joint return to claim the EIC. File 2007 taxes online Your filing status cannot be “Married filing separately. File 2007 taxes online ” Spouse did not live with you. File 2007 taxes online   If you are married and your spouse did not live in your home at any time during the last 6 months of the year, you may be able to file as head of household, instead of married filing separately. File 2007 taxes online In that case, you may be able to claim the EIC. File 2007 taxes online For detailed information about filing as head of household, see chapter 2 . File 2007 taxes online Rule 4. File 2007 taxes online You Must Be a U. File 2007 taxes online S. File 2007 taxes online Citizen or Resident Alien All Year If you (or your spouse, if married) were a nonresident alien for any part of the year, you cannot claim the earned income credit unless your filing status is married filing jointly. File 2007 taxes online You can use that filing status only if one spouse is a U. File 2007 taxes online S. File 2007 taxes online citizen or resident alien and you choose to treat the nonresident spouse as a U. File 2007 taxes online S. File 2007 taxes online resident. File 2007 taxes online If you make this choice, you and your spouse are taxed on your worldwide income. File 2007 taxes online If you (or your spouse, if married) were a nonresident alien for any part of the year and your filing status is not married filing jointly, enter “No” on the dotted line next to line 64a (Form 1040) or in the space to the left of line 38a (Form 1040A). File 2007 taxes online If you need more information on making this choice, get Publication 519, U. File 2007 taxes online S. File 2007 taxes online Tax Guide for Aliens. File 2007 taxes online Rule 5. File 2007 taxes online You Cannot File Form 2555 or Form 2555-EZ You cannot claim the earned income credit if you file Form 2555, Foreign Earned Income, or Form 2555-EZ, Foreign Earned Income Exclusion. File 2007 taxes online You file these forms to exclude income earned in foreign countries from your gross income, or to deduct or exclude a foreign housing amount. File 2007 taxes online U. File 2007 taxes online S. File 2007 taxes online possessions are not foreign countries. File 2007 taxes online See Publication 54, Tax Guide for U. File 2007 taxes online S. File 2007 taxes online Citizens and Resident Aliens Abroad, for more detailed information. File 2007 taxes online Rule 6. File 2007 taxes online Your Investment Income Must Be $3,300 or Less You cannot claim the earned income credit unless your investment income is $3,300 or less. File 2007 taxes online If your investment income is more than $3,300, you cannot claim the credit. File 2007 taxes online For most people, investment income is the total of the following amounts. File 2007 taxes online Taxable interest (line 8a of Form 1040 or 1040A). File 2007 taxes online Tax-exempt interest (line 8b of Form 1040 or 1040A). File 2007 taxes online Dividend income (line 9a of Form 1040 or 1040A). File 2007 taxes online Capital gain net income (line 13 of Form 1040, if more than zero, or line 10 of Form 1040A). File 2007 taxes online If you file Form 1040EZ, your investment income is the total of the amount of line 2 and the amount of any tax-exempt interest you wrote to the right of the words “Form 1040EZ” on line 2. File 2007 taxes online However, see Rule 6 in chapter 1 of Publication 596 if: You are filing Schedule E (Form 1040), Form 4797, or Form 8814, or You are reporting income from the rental of personal property on Form 1040, line 21. File 2007 taxes online Rule 7. File 2007 taxes online You Must Have Earned Income This credit is called the “earned income” credit because, to qualify, you must work and have earned income. File 2007 taxes online If you are married and file a joint return, you meet this rule if at least one spouse works and has earned income. File 2007 taxes online If you are an employee, earned income includes all the taxable income you get from your employer. File 2007 taxes online If you are self-employed or a statutory employee, you will figure your earned income on EIC Worksheet B in the instructions for Form 1040. File 2007 taxes online Earned Income Earned income includes all of the following types of income. File 2007 taxes online Wages, salaries, tips, and other taxable employee pay. File 2007 taxes online Employee pay is earned income only if it is taxable. File 2007 taxes online Nontaxable employee pay, such as certain dependent care benefits and adoption benefits, is not earned income. File 2007 taxes online But there is an exception for nontaxable combat pay, which you can choose to include in earned income, as explained below. File 2007 taxes online Net earnings from self-employment. File 2007 taxes online Gross income received as a statutory employee. File 2007 taxes online Wages, salaries, and tips. File 2007 taxes online   Wages, salaries, and tips you receive for working are reported to you on Form W-2, in box 1. File 2007 taxes online You should report these on line 1 (Form 1040EZ) or line 7 (Forms 1040A and 1040). File 2007 taxes online Nontaxable combat pay election. File 2007 taxes online   You can elect to include your nontaxable combat pay in earned income for the earned income credit. File 2007 taxes online Electing to include nontaxable combat pay in earned income may increase or decrease your EIC. File 2007 taxes online Figure the credit with and without your nontaxable combat pay before making the election. File 2007 taxes online   If you make the election, you must include in earned income all nontaxable combat pay you received. File 2007 taxes online If you are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election. File 2007 taxes online In other words, if one of you makes the election, the other one can also make it but does not have to. File 2007 taxes online   The amount of your nontaxable combat pay should be shown in box 12 of your Form W-2 with code “Q. File 2007 taxes online ” Self-employed persons and statutory employees. File 2007 taxes online   If you are self-employed or received income as a statutory employee, you must use the Form 1040 instructions to see if you qualify to get the EIC. File 2007 taxes online Approved Form 4361 or Form 4029 This section is for persons who have an approved: Form 4361, Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners, or Form 4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits. File 2007 taxes online Each approved form exempts certain income from social security taxes. File 2007 taxes online Each form is discussed here in terms of what is or is not earned income for the EIC. File 2007 taxes online Form 4361. File 2007 taxes online   Whether or not you have an approved Form 4361, amounts you received for performing ministerial duties as an employee count as earned income. File 2007 taxes online This includes wages, salaries, tips, and other taxable employee compensation. File 2007 taxes online A nontaxable housing allowance or the nontaxable rental value of a home is not earned income. File 2007 taxes online Also, amounts you received for performing ministerial duties, but not as an employee, do not count as earned income. File 2007 taxes online Examples include fees for performing marriages and honoraria for delivering speeches. File 2007 taxes online Form 4029. File 2007 taxes online   Whether or not you have an approved Form 4029, all wages, salaries, tips, and other taxable employee compensation count as earned income. File 2007 taxes online However, amounts you received as a self-employed individual do not count as earned income. File 2007 taxes online Also, in figuring earned income, do not subtract losses on Schedule C, C-EZ, or F from wages on line 7 of Form 1040. File 2007 taxes online Disability Benefits If you retired on disability, taxable benefits you receive under your employer's disability retirement plan are considered earned income until you reach minimum retirement age. File 2007 taxes online Minimum retirement age generally is the earliest age at which you could have received a pension or annuity if you were not disabled. File 2007 taxes online You must report your taxable disability payments on line 7 of either Form 1040 or Form 1040A until you reach minimum retirement age. File 2007 taxes online Beginning on the day after you reach minimum retirement age, payments you receive are taxable as a pension and are not considered earned income. File 2007 taxes online Report taxable pension payments on Form 1040, lines 16a and 16b (or Form 1040A, lines 12a and 12b). File 2007 taxes online Disability insurance payments. File 2007 taxes online   Payments you received from a disability insurance policy that you paid the premiums for are not earned income. File 2007 taxes online It does not matter whether you have reached minimum retirement age. File 2007 taxes online If this policy is through your employer, the amount may be shown in box 12 of your Form W-2 with code “J. File 2007 taxes online ” Income That Is Not Earned Income Examples of items that are not earned income include interest and dividends, pensions and annuities, social security and railroad retirement benefits (including disability benefits), alimony and child support, welfare benefits, workers' compensation benefits, unemployment compensation (insurance), nontaxable foster care payments, and veterans' benefits, including VA rehabilitation payments. File 2007 taxes online Do not include any of these items in your earned income. File 2007 taxes online Earnings while an inmate. File 2007 taxes online   Amounts received for work performed while an inmate in a penal institution are not earned income when figuring the earned income credit. File 2007 taxes online This includes amounts for work performed while in a work release program or while in a halfway house. File 2007 taxes online Workfare payments. File 2007 taxes online   Nontaxable workfare payments are not earned income for the EIC. File 2007 taxes online These are cash payments certain people receive from a state or local agency that administers public assistance programs funded under the federal Temporary Assistance for Needy Families (TANF) program in return for certain work activities such as (1) work experience activities (including remodeling or repairing public housing) if private sector employment is not available, or (2) community service program activities. File 2007 taxes online Community property. File 2007 taxes online   If you are married, but qualify to file as head of household under special rules for married taxpayers living apart (see Rule 3 ), and live in a state that has community property laws, your earned income for the EIC does not include any amount earned by your spouse that is treated as belonging to you under those laws. File 2007 taxes online That amount is not earned income for the EIC, even though you must include it in your gross income on your income tax return. File 2007 taxes online Your earned income includes the entire amount you earned, even if part of it is treated as belonging to your spouse under your state's community property laws. File 2007 taxes online Nevada, Washington, and California domestic partners. File 2007 taxes online   If you are a registered domestic partner in Nevada, Washington, or California, the same rules apply. File 2007 taxes online Your earned income for the EIC does not include any amount earned by your partner. File 2007 taxes online Your earned income includes the entire amount you earned. File 2007 taxes online For details, see Publication 555. File 2007 taxes online Conservation Reserve Program (CRP) payments. File 2007 taxes online   If you were receiving social security retirement benefits or social security disability benefits at the time you received any CRP payments, your CRP payments are not earned income for the EIC. File 2007 taxes online Nontaxable military pay. File 2007 taxes online   Nontaxable pay for members of the Armed Forces is not considered earned income for the EIC. File 2007 taxes online Examples of nontaxable military pay are combat pay, the Basic Allowance for Housing (BAH), and the Basic Allowance for Subsistence (BAS). File 2007 taxes online See Publication 3, Armed Forces' Tax Guide, for more information. File 2007 taxes online    Combat pay. File 2007 taxes online You can elect to include your nontaxable combat pay in earned income for the EIC. File 2007 taxes online See Nontaxable combat pay election, earlier. File 2007 taxes online Part B. File 2007 taxes online Rules If You Have a Qualifying Child If you have met all of the rules in Part A , read Part B to see if you have a qualifying child. File 2007 taxes online Part B discusses Rules 8 through 10. File 2007 taxes online You must meet all three of these rules, in addition to the rules in Parts A and D , to qualify for the earned income credit with a qualifying child. File 2007 taxes online You must file Form 1040 or Form 1040A to claim the EIC with a qualifying child. File 2007 taxes online (You cannot file Form 1040EZ. File 2007 taxes online ) You also must complete Schedule EIC and attach it to your return. File 2007 taxes online If you meet all the rules in Part A and this part, read Part D to find out what to do next. File 2007 taxes online If you do not meet Rule 8, you do not have a qualifying child. File 2007 taxes online Read Part C to find out if you can get the earned income credit without a qualifying child. File 2007 taxes online Rule 8. File 2007 taxes online Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests Your child is a qualifying child if your child meets four tests. File 2007 taxes online The four tests are: Relationship, Age, Residency, and Joint return. File 2007 taxes online The four tests are illustrated in Figure 36–1. File 2007 taxes online The paragraphs that follow contain more information about each test. File 2007 taxes online Relationship Test To be your qualifying child, a child must be your: Son, daughter, stepchild, foster child, or a descendant of any of them (for example, your grandchild), or Brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them (for example, your niece or nephew). File 2007 taxes online The following definitions clarify the relationship test. File 2007 taxes online Adopted child. File 2007 taxes online   An adopted child is always treated as your own child. File 2007 taxes online The term “adopted child” includes a child who was lawfully placed with you for legal adoption. File 2007 taxes online Foster child. File 2007 taxes online   For the EIC, a person is your foster child if the child is placed with you by an authorized placement agency or by judgement, decree, or other order of any court of competent jurisdiction. File 2007 taxes online An authorized placement agency includes a state or local government agency. File 2007 taxes online It also includes a tax-exempt organization licensed by a state. File 2007 taxes online In addition, it includes an Indian tribal government or an organization authorized by an Indian tribal government to place Indian children. File 2007 taxes online Example. File 2007 taxes online Debbie, who is 12 years old, was placed in your care 2 years ago by an authorized agency responsible for placing children in foster homes. File 2007 taxes online Debbie is your foster child. File 2007 taxes online Age Test Your child must be: Under age 19 at the end of 2013 and younger than you (or your spouse, if filing jointly), Under age 24 at the end of 2013, a student, and younger than you (or your spouse, if filing jointly), or Permanently and totally disabled at any time during 2013, regardless of age. File 2007 taxes online    The following examples and definitions clarify the age test. File 2007 taxes online Example 1—child not under age 19. File 2007 taxes online Your son turned 19 on December 10. File 2007 taxes online Unless he was permanently and totally disabled or a student, he is not a qualifying child because, at the end of the year, he was not under age 19. File 2007 taxes online Example 2—child not younger than you or your spouse. File 2007 taxes online Your 23-year-old brother, who is a full-time student and unmarried, lives with you and your spouse. File 2007 taxes online He is not disabled. File 2007 taxes online Both you and your spouse are 21 years old and you file a joint return. File 2007 taxes online Your brother is not your qualifying child because he is not younger than you or your spouse. File 2007 taxes online Example 3—child younger than your spouse but not younger than you. File 2007 taxes online The facts are the same as in Example 2 except that your spouse is 25 years old. File 2007 taxes online Because your brother is younger than your spouse, he is your qualifying child even though he is not younger than you. File 2007 taxes online Student defined. File 2007 taxes online   To qualify as a student, your child must be, during some part of each of any 5 calendar months during the calendar year: A full-time student at a school that has a regular teaching staff, course of study, and regular student body at the school, or A student taking a full-time, on-farm training course given by a school described in (1), or a state, county, or local government. File 2007 taxes online The 5 calendar months need not be consecutive. File 2007 taxes online   A full-time student is a student who is enrolled for the number of hours or courses the school considers to be full-time attendance. File 2007 taxes online School defined. File 2007 taxes online   A school can be an elementary school, junior or senior high school, college, university, or technical, trade, or mechanical school. File 2007 taxes online However, on-the-job training courses, correspondence schools, and schools offering courses only through the Internet do not count as schools for the EIC. File 2007 taxes online Vocational high school students. File 2007 taxes online   Students who work in co-op jobs in private industry as a part of a school's regular course of classroom and practical training are considered full-time students. File 2007 taxes online Permanently and totally disabled. File 2007 taxes online   Your child is permanently and totally disabled if both of the following apply. File 2007 taxes online He or she cannot engage in any substantial gainful activity because of a physical or mental condition. File 2007 taxes online A doctor determines the condition has lasted or can be expected to last continuously for at least a year or can lead to death. File 2007 taxes online Residency Test Your child must have lived with you in the United States for more than half of 2013. File 2007 taxes online The following definitions clarify the residency test. File 2007 taxes online United States. File 2007 taxes online   This means the 50 states and the District of Columbia. File 2007 taxes online It does not include Puerto Rico or U. File 2007 taxes online S. File 2007 taxes online possessions such as Guam. File 2007 taxes online Homeless shelter. File 2007 taxes online   Your home can be any location where you regularly live. File 2007 taxes online You do not need a traditional home. File 2007 taxes online For example, if your child lived with you for more than half the year in one or more homeless shelters, your child meets the residency test. File 2007 taxes online Military personnel stationed outside the United States. File 2007 taxes online    U. File 2007 taxes online S. File 2007 taxes online military personnel stationed outside the United States on extended active duty are considered to live in the United States during that duty period for purposes of the EIC. File 2007 taxes online Figure 36-1. File 2007 taxes online Tests for Qualifying Child Please click here for the text description of the image. File 2007 taxes online Qualifying child Extended active duty. File 2007 taxes online   Extended active duty means you are called or ordered to duty for an indefinite period or for a period of more than 90 days. File 2007 taxes online Once you begin serving your extended active duty, you are still considered to have been on extended active duty even if you do not serve more than 90 days. File 2007 taxes online Birth or death of a child. File 2007 taxes online   A child who was born or died in 2013 is treated as having lived with you for more than half of 2013 if your home was the child's home for more than half the time he or she was alive in 2013. File 2007 taxes online Temporary absences. File 2007 taxes online   Count time that you or your child is away from home on a temporary absence due to a special circumstance as time the child lived with you. File 2007 taxes online Examples of a special circumstance include illness, school attendance, business, vacation, military service, and detention in a juvenile facility. File 2007 taxes online Kidnapped child. File 2007 taxes online    A kidnapped child is treated as living with you for more than half of the year if the child lived with you for more than half the part of the year before the date of the kidnapping. File 2007 taxes online The child must be presumed by law enforcement authorities to have been kidnapped by someone who is not a member of your family or your child's family. File 2007 taxes online This treatment applies for all years until the child is returned. File 2007 taxes online However, the last year this treatment can apply is the earlier of: The year there is a determination that the child is dead, or The year the child would have reached age 18. File 2007 taxes online   If your qualifying child has been kidnapped and meets these requirements, enter “KC,” instead of a number, on line 6 of Schedule EIC. File 2007 taxes online Joint Return Test To meet this test, the child cannot file a joint return for the year. File 2007 taxes online Exception. File 2007 taxes online   An exception to the joint return test applies if your child and his or her spouse file a joint return only to claim a refund of income tax withheld or estimated tax paid. File 2007 taxes online Example 1—child files joint return. File 2007 taxes online You supported your 18-year-old daughter, and she lived with you all year while her husband was in the Armed Forces. File 2007 taxes online He earned $25,000 for the year. File 2007 taxes online The couple files a joint return. File 2007 taxes online Because your daughter and her husband filed a joint return, she is not your qualifying child. File 2007 taxes online Example 2—child files joint return only to claim a refund of withheld tax. File 2007 taxes online Your 18-year-old son and his 17-year-old wife had $800 of wages from part-time jobs and no other income. File 2007 taxes online They do not have a child. File 2007 taxes online Neither is required to file a tax return. File 2007 taxes online Taxes were taken out of their pay, so they filed a joint return only to get a refund of the withheld taxes. File 2007 taxes online The exception to the joint return test applies, so your son may be your qualifying child if all the other tests are met. File 2007 taxes online Example 3—child files joint return to claim American opportunity credit. File 2007 taxes online The facts are the same as in Example 2 except no taxes were taken out of your son's pay. File 2007 taxes online He and his wife are not required to file a tax return, but they file a joint return to claim an American opportunity credit of $124 and get a refund of that amount. File 2007 taxes online Because claiming the American opportunity credit is their reason for filing the return, they are not filing it only to get a refund of income tax withheld or estimated tax paid. File 2007 taxes online The exception to the joint return test does not apply, so your son is not your qualifying child. File 2007 taxes online Married child. File 2007 taxes online   Even if your child does not file a joint return, if your child was married at the end of the year, he or she cannot be your qualifying child unless: You can claim an exemption for the child, or The reason you cannot claim an exemption for the child is that you let the child's other parent claim the exemption under the Special rule for divorced or separated parents (or parents who live apart) , described later. File 2007 taxes online Social security number. File 2007 taxes online   The qualifying child must have a valid social security number (SSN) unless the child was born and died in 2013 and you attach to your return a copy of the child's birth certificate, death certificate, or hospital records showing a live birth. File 2007 taxes online You cannot claim the EIC on the basis of a qualifying child if: The qualifying child's SSN is missing from your tax return or is incorrect, The qualifying child's social security card says “Not valid for employment” and was issued for use in getting a federally funded benefit, or Instead of an SSN, the qualifying child has: An individual taxpayer identification number (ITIN), which is issued to a noncitizen who cannot get an SSN, or An adoption taxpayer identification number (ATIN), which is issued to adopting parents who cannot get an SSN for the child being adopted until the adoption is final. File 2007 taxes online   If you have more than one qualifying child and only one has a valid SSN, you can use only that child to claim the EIC. File 2007 taxes online For more information about SSNs, see Rule 2 . File 2007 taxes online Rule 9. File 2007 taxes online Your Qualifying Child Cannot Be Used By More Than One Person To Claim the EIC Sometimes a child meets the tests to be a qualifying child of more than one person. File 2007 taxes online However, only one of these persons can actually treat the child as a qualifying child. File 2007 taxes online Only that person can use the child as a qualifying child to take all of the following tax benefits (provided the person is eligible for each benefit). File 2007 taxes online The exemption for the child. File 2007 taxes online The child tax credit. File 2007 taxes online Head of household filing status. File 2007 taxes online The credit for child and dependent care expenses. File 2007 taxes online The exclusion for dependent care benefits. File 2007 taxes online The EIC. File 2007 taxes online The other person cannot take any of these benefits based on this qualifying child. File 2007 taxes online In other words, you and the other person cannot agree to divide these tax benefits between you. File 2007 taxes online The other person cannot take any of these tax benefits unless he or she has a different qualifying child. File 2007 taxes online The tiebreaker rules explained next explain who, if anyone, can claim the EIC when more than one person has the same qualifying child. File 2007 taxes online However, the tiebreaker rules do not apply if the other person is your spouse and you file a joint return. File 2007 taxes online Tiebreaker rules. File 2007 taxes online   To determine which person can treat the child as a qualifying child to claim the six tax benefits just listed, the following tiebreaker rules apply. File 2007 taxes online If only one of the persons is the child's parent, the child is treated as the qualifying child of the parent. File 2007 taxes online If the parents file a joint return together and can claim the child as a qualifying child, the child is treated as the qualifying child of the parents. File 2007 taxes online If the parents do not file a joint return together but both parents claim the child as a qualifying child, the IRS will treat the child as the qualifying child of the parent with whom the child lived for the longer period of time during the year. File 2007 taxes online If the child lived with each parent for the same amount of time, the IRS will treat the child as the qualifying child of the parent who had the higher adjusted gross income (AGI) for the year. File 2007 taxes online If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person who had the highest AGI for the year. File 2007 taxes online If a parent can claim the child as a qualifying child but no parent does so claim the child, the child is treated as the qualifying child of the person who had the highest AGI for the year, but only if that person's AGI is higher than the highest AGI of any of the child's parents who can claim the child. File 2007 taxes online If the child's parents file a joint return with each other, this rule can be applied by treating the parents' total AGI as divided evenly between them. File 2007 taxes online See Example 8 . File 2007 taxes online   Subject to these tiebreaker rules, you and the other person may be able to choose which of you claims the child as a qualifying child. File 2007 taxes online See Examples 1 through 13 . File 2007 taxes online   If you cannot claim the EIC because your qualifying child is treated under the tiebreaker rules as the qualifying child of another person for 2013, you may be able to take the EIC using a different qualifying child, but you cannot take the EIC using the rules in Part C for people who do not have a qualifying child. File 2007 taxes online If the other person cannot claim the EIC. File 2007 taxes online   If you and someone else have the same qualifying child but the other person cannot claim the EIC because he or she is not eligible or his or her earned income or AGI is too high, you may be able to treat the child as a qualifying child. File 2007 taxes online See Examples 6 and 7 . File 2007 taxes online But you cannot treat the child as a qualifying child to claim the EIC if the other person uses the child to claim any of the other six tax benefits listed earlier. File 2007 taxes online Examples. File 2007 taxes online The following examples may help you in determining whether you can claim the EIC when you and someone else have the same qualifying child. File 2007 taxes online Example 1. File 2007 taxes online You and your 2-year-old son Jimmy lived with your mother all year. File 2007 taxes online You are 25 years old, unmarried, and your AGI is $9,000. File 2007 taxes online Your only income was $9,000 from a part-time job. File 2007 taxes online Your mother's only income was $20,000 from her job, and her AGI is $20,000. File 2007 taxes online Jimmy's father did not live with you or Jimmy. File 2007 taxes online The special rule explained later for divorced or separated parents (or parents who live apart) does not apply. File 2007 taxes online Jimmy is a qualifying child of both you and your mother because he meets the relationship, age, residency, and joint return tests for both you and your mother. File 2007 taxes online However, only one of you can treat him as a qualifying child to claim the EIC (and the other tax benefits listed earlier for which that person qualifies). File 2007 taxes online He is not a qualifying child of anyone else, including his father. File 2007 taxes online If you do not claim Jimmy as a qualifying child for the EIC or any of the other tax benefits listed earlier, your mother can treat him as a qualifying child to claim the EIC (and any of the other tax benefits listed earlier for which she qualifies). File 2007 taxes online Example 2. File 2007 taxes online The facts are the same as in Example 1 except your AGI is $25,000. File 2007 taxes online Because your mother's AGI is not higher than yours, she cannot claim Jimmy as a qualifying child. File 2007 taxes online Only you can claim him. File 2007 taxes online Example 3. File 2007 taxes online The facts are the same as in Example 1 except that you and your mother both claim Jimmy as a qualifying child. File 2007 taxes online In this case, you as the child's parent will be the only one allowed to claim Jimmy as a qualifying child for the EIC and the other tax benefits listed earlier for which you qualify. File 2007 taxes online The IRS will disallow your mother's claim to the EIC and any of the other tax benefits listed earlier unless she has another qualifying child. File 2007 taxes online Example 4. File 2007 taxes online The facts are the same as in Example 1 except that you also have two other young children who are qualifying children of both you and your mother. File 2007 taxes online Only one of you can claim each child. File 2007 taxes online However, if your mother's AGI is higher than yours, you can allow your mother to claim one or more of the children. File 2007 taxes online For example, if you claim one child, your mother can claim the other two. File 2007 taxes online Example 5. File 2007 taxes online The facts are the same as in Example 1 except that you are only 18 years old. File 2007 taxes online This means you are a qualifying child of your mother. File 2007 taxes online Because of Rule 10 , discussed next, you cannot claim the EIC and cannot claim Jimmy as a qualifying child. File 2007 taxes online Only your mother may be able to treat Jimmy as a qualifying child to claim the EIC. File 2007 taxes online If your mother meets all the other requirements for claiming the EIC and you do not claim Jimmy as a qualifying child for any of the other tax benefits listed earlier, your mother can claim both you and Jimmy as qualifying children for the EIC. File 2007 taxes online Example 6. File 2007 taxes online The facts are the same as in Example 1 except that your mother earned $50,000 from her job. File 2007 taxes online Because your mother's earned income is too high for her to claim the EIC, only you can claim the EIC using your son. File 2007 taxes online Example 7. File 2007 taxes online The facts are the same as in Example 1 except that you earned $50,000 from your job and your AGI is $50,500. File 2007 taxes online Your earned income is too high for you to claim the EIC. File 2007 taxes online But your mother cannot claim the EIC either, because her AGI is not higher than yours. File 2007 taxes online Example 8. File 2007 taxes online The facts are the same as in Example 1 except that you and Jimmy's father are married to each other, live with Jimmy and your mother, and have an AGI of $30,000 on a joint return. File 2007 taxes online If you and your husband do not claim Jimmy as a qualifying child for the EIC or any of the other tax benefits listed earlier, your mother can claim him instead. File 2007 taxes online Even though the AGI on your joint return, $30,000, is more than your mother's AGI of $20,000, for this purpose half of the joint AGI can be treated as yours and half as your husband's. File 2007 taxes online In other words, each parent's AGI can be treated as $15,000. File 2007 taxes online Example 9. File 2007 taxes online You, your husband, and your 10-year-old son Joey lived together until August 1, 2013, when your husband moved out of the household. File 2007 taxes online In August and September, Joey lived with you. File 2007 taxes online For the rest of the year, Joey lived with your husband, who is Joey's father. File 2007 taxes online Joey is a qualifying child of both you and your husband because he lived with each of you for more than half the year and because he met the relationship, age, and joint return tests for both of you. File 2007 taxes online At the end of the year, you and your husband still were not divorced, legally separated, or separated under a written separation agreement, so the special rule for divorced or separated parents (or parents who live apart) does not apply. File 2007 taxes online You and your husband will file separate returns. File 2007 taxes online Your husband agrees to let you treat Joey as a qualifying child. File 2007 taxes online This means, if your husband does not claim Joey as a qualifying child for any of the tax benefits listed earlier, you can claim him as a qualifying child for any tax benefit listed earlier for which you qualify. File 2007 taxes online However, your filing status is married filing separately, so you cannot claim the EIC or the credit for child and dependent care expenses. File 2007 taxes online See Rule 3 . File 2007 taxes online Example 10. File 2007 taxes online The facts are the same as in Example 9 except that you and your husband both claim Joey as a qualifying child. File 2007 taxes online In this case, only your husband will be allowed to treat Joey as a qualifying child. File 2007 taxes online This is because, during 2013, the boy lived with him longer than with you. File 2007 taxes online You cannot claim the EIC (either with or without a qualifying child). File 2007 taxes online However, your husband's filing status is married filing separately, so he cannot claim the EIC or the credit for child and dependent care expenses. File 2007 taxes online See Rule 3 . File 2007 taxes online Example 11. File 2007 taxes online You, your 5-year-old son and your son's father lived together all year. File 2007 taxes online You and your son's father are not married. File 2007 taxes online Your son is a qualifying child of both you and his father because he meets the relationship, age, residency, and joint return tests for both you and his father. File 2007 taxes online Your earned income and AGI are $12,000, and your son's father's earned income and AGI are $14,000. File 2007 taxes online Neither of you had any other income. File 2007 taxes online Your son's father agrees to let you treat the child as a qualifying child. File 2007 taxes online This means, if your son's father does not claim your son as a qualifying child for the EIC or any of the other tax benefits listed earlier, you can claim him as a qualifying child for the EIC and any of the other tax benefits listed earlier for which you qualify. File 2007 taxes online Example 12. File 2007 taxes online The facts are the same as in Example 11 except that you and your son's father both claim your son as a qualifying child. File 2007 taxes online In this case, only your son's father will be allowed to treat your son as a qualifying child. File 2007 taxes online This is because his AGI, $14,000, is more than your AGI, $12,000. File 2007 taxes online You cannot claim the EIC (either with or without a qualifying child). File 2007 taxes online Example 13. File 2007 taxes online You and your 7-year-old niece, your sister's child, lived with your mother all year. File 2007 taxes online You are 25 years old, and your AGI is $9,300. File 2007 taxes online Your only income was from a part-time job. File 2007 taxes online Your mother's AGI is $15,000. File 2007 taxes online Her only income was from her job. File 2007 taxes online Your niece's parents file jointly, have an AGI of less than $9,000, and do not live with you or their child. File 2007 taxes online Your niece is a qualifying child of both you and your mother because she meets the relationship, age, residency, and joint return tests for both you and your mother. File 2007 taxes online However, only your mother can treat her as a qualifying child. File 2007 taxes online This is because your mother's AGI, $15,000, is more than your AGI, $9,300. File 2007 taxes online Special rule for divorced or separated parents (or parents who live apart). File 2007 taxes online   A child will be treated as the qualifying child of his or her noncustodial parent (for purposes of claiming an exemption and the child tax credit, but not for the EIC) if all of the following statements are true. File 2007 taxes online The parents: Are divorced or legally separated under a decree of divorce or separate maintenance, Are separated under a written separation agreement, or Lived apart at all times during the last 6 months of 2013, whether or not they are or were married. File 2007 taxes online The child received over half of his or her support for the year from the parents. File 2007 taxes online The child is in the custody of one or both parents for more than half of 2013. File 2007 taxes online Either of the following statements is true. File 2007 taxes online The custodial parent signs Form 8332 or a substantially similar statement that he or she will not claim the child as a dependent for the year, and the noncustodial parent attaches the form or statement to his or her return. File 2007 taxes online If the divorce decree or separation agreement went into effect after 1984 and before 2009, the noncustodial parent may be able to attach certain pages from the decree or agreement instead of Form 8332. File 2007 taxes online A pre-1985 decree of divorce or separate maintenance or written separation agreement that applies to 2013 provides that the noncustodial parent can claim the child as a dependent, and the noncustodial parent provides at least $600 for support of the child during 2013. File 2007 taxes online  For details, see chapter 3. File 2007 taxes online Also see Applying Rule 9 to divorced or separated parents (or parents who live apart) , next. File 2007 taxes online Applying Rule 9 to divorced or separated parents (or parents who live apart). File 2007 taxes online   If a child is treated as the qualifying child of the noncustodial parent under the special rule just described for children of divorced or separated parents (or parents who live apart), only the noncustodial parent can claim an exemption and the child tax credit for the child. File 2007 taxes online However, the custodial parent, if eligible, or another eligible taxpayer can claim the child as a qualifying child for the EIC and other tax benefits listed earlier in this chapter. File 2007 taxes online If the child is the qualifying child of more than one person for these benefits, then the tiebreaker rules determine which person can treat the child as a qualifying child. File 2007 taxes online Example 1. File 2007 taxes online You and your 5-year-old son lived all year with your mother, who paid the entire cost of keeping up the home. File 2007 taxes online Your AGI is $10,000. File 2007 taxes online Your mother’s AGI is $25,000. File 2007 taxes online Your son's father did not live with you or your son. File 2007 taxes online Under the special rule for children of divorced or separated parents (or parents who live apart), your son is treated as the qualifying child of his father, who can claim an exemption and the child tax credit for the child. File 2007 taxes online However, your son's father cannot claim your son as a qualifying child for head of household filing status, the credit for child and dependent care expenses, the exclusion for dependent care benefits, or the EIC. File 2007 taxes online You and your mother did not have any child care expenses or dependent care benefits. File 2007 taxes online If you do not claim your son as a qualifying child, your mother can claim him as a qualifying child for the EIC and head of household filing status, if she qualifies for these tax benefits. File 2007 taxes online Example 2. File 2007 taxes online The facts are the same as in Example 1 except that your AGI is $25,000 and your mother's AGI is $21,000. File 2007 taxes online Your mother cannot claim your son as a qualifying child for any purpose because her AGI is not higher than yours. File 2007 taxes online Example 3. File 2007 taxes online The facts are the same as in Example 1 except that you and your mother both claim your son as a qualifying child for the EIC. File 2007 taxes online Your mother also claims him as a qualifying child for head of household filing status. File 2007 taxes online You as the child's parent will be the only one allowed to claim your son as a qualifying child for the EIC. File 2007 taxes online The IRS will disallow your mother's claim to the EIC and head of household filing status unless she has another qualifying child. File 2007 taxes online Rule 10. File 2007 taxes online You Cannot Be a Qualifying Child of Another Taxpayer You are a qualifying child of another taxpayer (your parent, guardian, foster parent, etc. File 2007 taxes online ) if all of the following statements are true. File 2007 taxes online You are that person's son, daughter, stepchild, foster child, or a descendant of any of them. File 2007 taxes online Or, you are that person's brother, sister, half brother, half sister, stepbrother, or stepsister (or a descendant of any of them). File 2007 taxes online You were: Under age 19 at the end of the year and younger than that person (or that person's spouse, if the person files jointly), Under age 24 at the end of the year, a student, and younger than that person (or that person's spouse, if the person files jointly), or Permanently and totally disabled, regardless of age. File 2007 taxes online You lived with that person in the United States for more than half of the year. File 2007 taxes online You are not filing a joint return for the year (or are filing a joint return only to claim a refund of withheld income tax or estimated tax paid). File 2007 taxes online For more details about the tests to be a qualifying child, see Rule 8 . File 2007 taxes online If you are a qualifying child of another taxpayer, you cannot claim the EIC. File 2007 taxes online This is true even if the person for whom you are a qualifying child does not claim the EIC or meet all of the rules to claim the EIC. File 2007 taxes online Put “No” beside line 64a (Form 1040) or line 38a (Form 1040A). File 2007 taxes online Example. File 2007 taxes online You and your daughter lived with your mother all year. File 2007 taxes online You are 22 years old, unmarried, and attended a trade school full time. File 2007 taxes online You had a part-time job and earned $5,700. File 2007 taxes online You had no other income. File 2007 taxes online Because you meet the relationship, age, residency, and joint return tests, you are a qualifying child of your mother. File 2007 taxes online She can claim the EIC if she meets all the other requirements. File 2007 taxes online Because you are your mother's qualifying child, you cannot claim the EIC. File 2007 taxes online This is so even if your mother cannot or does not claim the EIC. File 2007 taxes online Child of person not required to file a return. File 2007 taxes online   You are not the qualifying child of another taxpayer (and so may qualify to claim the EIC) if the person for whom you meet the relationship, age, residency, and joint return tests is not required to file an income tax return and either: Does not file an income tax return, or Files a return only to get a refund of income tax withheld or estimated tax paid. File 2007 taxes online Example. File 2007 taxes online The facts are the same as in the last example except your mother had no gross income, is not required to file a 2013 tax return, and does not file a 2013 tax return. File 2007 taxes online As a result, you are not your mother's qualifying child. File 2007 taxes online You can claim the EIC if you meet all the other requirements to do so. File 2007 taxes online   See Rule 10 in Publication 596 for additional examples. File 2007 taxes online Part C. File 2007 taxes online Rules If You Do Not Have a Qualifying Child Read this part if you: Do not have a qualifying child, and Have met all the rules in Part A . File 2007 taxes online  Part C discusses Rules 11 through 14. File 2007 taxes online You must meet all four of these rules, in addition to the rules in Parts A and D , to qualify for the earned income credit without a qualifying child. File 2007 taxes online If you have a qualifying child, the rules in this part do not apply to you. File 2007 taxes online You can claim the credit only if you meet all the rules in Parts A, B, and D. File 2007 taxes online See Rule 8 to find out if you have a qualifying child. File 2007 taxes online Rule 11. File 2007 taxes online You Must Be at Least Age 25 but Under Age 65 You must be at least age 25 but under age 65 at the end of 2013. File 2007 taxes online If you are married filing a joint return, either you or your spouse must be at least age 25 but under age 65 at the end of 2013. File 2007 taxes online It does not matter which spouse meets the age test, as long as one of the spouses does. File 2007 taxes online You meet the age test if you were born after December 31, 1948, and before January 2, 1989. File 2007 taxes online If you are married filing a joint return, you meet the age test if either you or your spouse was born after December 31, 1948, and before January 2, 1989. File 2007 taxes online If neither you nor your spouse meets the age test, you cannot claim the EIC. File 2007 taxes online Put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). File 2007 taxes online Death of spouse. File 2007 taxes online   If you are filing a joint return with your spouse who died in 2013, you meet the age test if your spouse was at least age 25 but under age 65 at the time of death. File 2007 taxes online Example 1. File 2007 taxes online You are age 28 and unmarried. File 2007 taxes online You meet the age test. File 2007 taxes online Example 2—spouse meets age test. File 2007 taxes online You are married and filing a joint return. File 2007 taxes online You are age 23 and your spouse is age 27. File 2007 taxes online You meet the age test because your spouse is at least age 25 but under age 65. File 2007 taxes online Example 3—spouse dies in 2013. File 2007 taxes online You are married and filing a joint return with your spouse who died in August 2013. File 2007 taxes online You are age 67. File 2007 taxes online Your spouse would have become age 65 in November 2013. File 2007 taxes online Because your spouse was under age 65 when she died, you meet the age test. File 2007 taxes online Rule 12. File 2007 taxes online You Cannot Be the Dependent of Another Person If you are not filing a joint return, you meet this rule if: You checked box 6a on Form 1040 or 1040A, or You did not check the “You” box on line 5 of Form 1040EZ, and you entered $10,000 on that line. File 2007 taxes online If you are filing a joint return, you meet this rule if: You checked both box 6a and box 6b on Form 1040 or 1040A, or You and your spouse did not check either the “You” box or the “Spouse” box on line 5 of Form 1040EZ, and you entered $20,000 on that line. File 2007 taxes online If you are not sure whether someone else can claim you (or your spouse, if filing a joint return) as a dependent, read the rules for claiming a dependent in chapter 3. File 2007 taxes online If someone else can claim you (or your spouse, if filing a joint return) as a dependent on his or her return, but does not, you still cannot claim the credit. File 2007 taxes online Example 1. File 2007 taxes online In 2013, you were age 25, single, and living at home with your parents. File 2007 taxes online You worked and were not a student. File 2007 taxes online You earned $7,500. File 2007 taxes online Your parents cannot claim you as a dependent. File 2007 taxes online When you file your return, you claim an exemption for yourself by not checking the “You” box on line 5 of your Form 1040EZ and by entering $10,000 on that line. File 2007 taxes online You meet this rule. File 2007 taxes online You can claim the EIC if you meet all the other requirements. File 2007 taxes online Example 2. File 2007 taxes online The facts are the same as in Example 1 , except that you earned $2,000. File 2007 taxes online Your parents can claim you as a dependent but decide not to. File 2007 taxes online You do not meet this rule. File 2007 taxes online You cannot claim the credit because your parents could have claimed you as a dependent. File 2007 taxes online Joint returns. File 2007 taxes online   You generally cannot be claimed as a dependent by another person if you are married and file a joint return. File 2007 taxes online   However, another person may be able to claim you as a dependent if you and your spouse file a joint return only to get a refund of income tax withheld or estimated tax paid. File 2007 taxes online But neither you nor your spouse can be claimed as a dependent by another person if you claim the EIC on your joint return. File 2007 taxes online Example 1. File 2007 taxes online You are 26 years old. File 2007 taxes online You and your wife live with your parents and had $800 of wages from part-time jobs and no other income. File 2007 taxes online Neither you nor your wife is required to file a tax return. File 2007 taxes online You do not have a child. File 2007 taxes online Taxes were taken out of your pay, so you file a joint return only to get a refund of the withheld taxes. File 2007 taxes online Your parents are not disqualified from claiming an exemption for you just because you filed a joint return. File 2007 taxes online They can claim exemptions for you and your wife if all the other tests to do so are met. File 2007 taxes online Example 2. File 2007 taxes online The facts are the same as in Example 1 except no taxes were taken out of your pay. File 2007 taxes online Also, you and your wife are not required to file a tax return, but you file a joint return to claim an EIC of $63 and get a refund of that amount. File 2007 taxes online Because claiming the EIC is your reason for filing the return, you are not filing it only to get a refund of income tax withheld or estimated tax paid. File 2007 taxes online Your parents cannot claim an exemption for either you or your wife. File 2007 taxes online Rule 13. File 2007 taxes online You Cannot Be a Qualifying Child of Another Taxpayer You are a qualifying child of another taxpayer (your parent, guardian, foster parent, etc. File 2007 taxes online ) if all of the following statements are true. File 2007 taxes online You are that person's son, daughter, stepchild, foster child, or a descendant of any of them. File 2007 taxes online Or, you are that person's brother, sister, half brother, half sister, stepbrother, or stepsister (or a descendant of any of them). File 2007 taxes online You were: Under age 19 at the end of the year and younger than that person (or that person's spouse, if the person files jointly), Under age 24 at the end of the year, a student (as defined in Rule 8 ), and younger than that person (or that person's spouse, if the person files jointly), or Permanently and totally disabled, regardless of age. File 2007 taxes online You lived with that person in the United States for more than half of the year. File 2007 taxes online You are not filing a joint return for the year (or are filing a joint return only to claim a refund of withheld income tax or estimated tax paid). File 2007 taxes online For more details about the tests to be a qualifying child, see Rule 8 . File 2007 taxes online If you are a qualifying child of another taxpayer, you cannot claim the EIC. File 2007 taxes online This is true even if the person for whom you are a qualifying child does not claim the EIC or meet all of the rules to claim the EIC. File 2007 taxes online Put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). File 2007 taxes online Example. File 2007 taxes online You lived with your mother all year. File 2007 taxes online You are age 26, unmarried, and permanently and totally disabled. File 2007 taxes online Your only income was from a community center where you went three days a week to answer telephones. File 2007 taxes online You earned $5,000 for the year and provided more than half of your own support. File 2007 taxes online Because you meet the relationship, age, residency, and joint return tests, you are a qualifying child of your mother for the EIC. File 2007 taxes online She can claim the EIC if she meets all the other requirements. File 2007 taxes online Because you are a qualifying child of your mother, you cannot claim the EIC. File 2007 taxes online This is so even if your mother cannot or does not claim the EIC. File 2007 taxes online Joint returns. File 2007 taxes online   You generally cannot be a qualifying child of another taxpayer if you are married and file a joint return. File 2007 taxes online   However, you may be a qualifying child of another taxpayer if you and your spouse file a joint return for the year only to get a refund of income tax withheld or estimated tax paid. File 2007 taxes online But neither you nor your spouse can be a qualifying child of another taxpayer if you claim the EIC on your joint return. File 2007 taxes online Child of person not required to file a return. File 2007 taxes online   You are not the qualifying child of another taxpayer (and so may qualify to claim the EIC) if the person for whom you meet the relationship, age, residency, and joint return tests is not required to file an income tax return and either: Does not file an income tax return, or Files a return only to get a refund of income tax withheld or estimated tax paid. File 2007 taxes online Example. File 2007 taxes online You lived all year with your father. File 2007 taxes online You are 27 years old, unmarried, permanently and totally disabled, and earned $13,000. File 2007 taxes online You have no other income, no children, and provided more than half of your own support. File 2007 taxes online Your father had no gross income, is not required to file a 2013 tax return, and does not file a 2013 tax return. File 2007 taxes online As a result, you are not your father's qualifying child. File 2007 taxes online You can claim the EIC if you meet all the other requirements to do so. File 2007 taxes online   See Rule 13 in Publication 596 for additional examples. File 2007 taxes online Rule 14. File 2007 taxes online You Must Have Lived in the United States More Than Half of the Year Your home (and your spouse's, if filing a joint return) must have been in the United States for more than half the year. File 2007 taxes online If it was not, put “No” next to line 64a (Form 1040), line 38a (Form 1040A), or line 8a (Form 1040EZ). File 2007 taxes online United States. File 2007 taxes online   This means the 50 states and the District of Columbia. File 2007 taxes online It does not include Puerto Rico or U. File 2007 taxes online S. File 2007 taxes online possessions such as Guam. File 2007 taxes online Homeless shelter. File 2007 taxes online   Your home can be any location where you regularly live. File 2007 taxes online You do not need a traditional home. File 2007 taxes online If you lived in one or more homeless shelters in the United States for more than half the year, you meet this rule. File 2007 taxes online Military personnel stationed outside the United States. File 2007 taxes online   U. File 2007 taxes online S. File 2007 taxes online military personnel stationed outside the United States on extended active duty (defined in Rule 8 ) are considered to live in the United States during that duty period for purposes of the EIC. File 2007 taxes online Part D. File 2007 taxes online Figuring and Claiming the EIC Read this part if you have met all the rules in Parts A and B, or all the rules in Parts A and C. File 2007 taxes online Part D discusses Rule 15 . File 2007 taxes online You must meet this rule, in addition to the rules in Parts A and B , or Parts A and C , to qualify for the earned income credit. File 2007 taxes online This part of the chapter also explains how to figure the amount of your credit. File 2007 taxes online You have two choices. File 2007 taxes online Have the IRS figure the EIC for you. File 2007 taxes online If you want to do this, see IRS Will Figure the EIC for You . File 2007 taxes online Figure the EIC yourself. File 2007 taxes online If you want to do this, see How To Figure the EIC Yourself . File 2007 taxes online Rule 15. File 2007 taxes online Your Earned Income Must Be Less Than: $46,227 ($51,567 for married filing jointly) if you have three or more qualifying children, $43,038 ($48,378 for married filing jointly) if you have two qualifying children, $37,870 ($43,210 for married filing jointly) if you have one qualifying child, or $14,340 ($19,680 for married filing jointly) if you do not have a qualifying child. File 2007 taxes online Earned income generally means wages, salaries, tips, other taxable employee pay, and net earnings from self-employment. File 2007 taxes online Employee pay is earned income only if it is taxable. File 2007 taxes online Nontaxable employee pay, such as certain dependent care benefits and adoption benefits, is not earned income. File 2007 taxes online But there is an exception for nontaxable combat pay, which you can choose to include in earned income. File 2007 taxes online Earned income is explained in detail in Rule 7 . File 2007 taxes online Figuring earned income. File 2007 taxes online   If you are self-employed, a statutory employee, or a member of the clergy or a church employee who files Schedule SE (Form 1040), you will figure your earned income when you fill out Part 4 of EIC Worksheet B in the Form 1040 instructions. File 2007 taxes online   Otherwise, figure your earned income by using the worksheet in Step 5 of the Form 1040 instructions for lines 64a and 64b or the Form 1040A instructions for lines 38a and 38b, or the worksheet in Step 2 of the Form 1040EZ instructions for lines 8a and 8b. File 2007 taxes online   When using one of those worksheets to figure your earned income, you will start with the amount on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ). File 2007 taxes online You will then reduce that amount by any amount included on that line and described in the following list: Scholarship or fellowship grants not reported on a Form W-2, Inmate's income, and Pension or annuity from deferred compensation plans. File 2007 taxes online Scholarship or fellowship grants not reported on a Form W-2. File 2007 taxes online   A scholarship or fellowship grant that was not reported to you on a Form W-2 is not considered earned income for the earned income credit. File 2007 taxes online Inmate's income. File 2007 taxes online   Amounts received for work performed while an inmate in a penal institution are not earned income for the earned income credit. File 2007 taxes online This includes amounts received for work performed while in a work release program or while in a halfway house. File 2007 taxes online If you received any amount for work done while an inmate in a penal institution and that amount is included in the total on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ), put “PRI” and the amount on the dotted line next to line 7 (Form 1040), in the space to the left of the entry space for line 7 (Form 1040A), or in the space to the left of line 1 (Form 1040EZ). File 2007 taxes online Pension or annuity from deferred compensation plans. File 2007 taxes online   A pension or annuity from a nonqualified deferred compensation plan or a nongovernmental section 457 plan is not considered earned income for the earned income credit. File 2007 taxes online If you received such an amount and it was included in the total on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ), put “DFC” and the amount on the dotted line next to line 7 (Form 1040), in the space to the left of the entry space for line 7 (Form 1040A), or in the space to the left of line 1 (Form 1040EZ). File 2007 taxes online This amount may be reported in box 11 of your Form W-2. File 2007 taxes online If you received such an amount but box 11 is blank, contact your employer for the amount received as a pension or annuity. File 2007 taxes online Clergy. File 2007 taxes online   If you are a member of the clergy who files Schedule SE and the amount on line 2 of that schedule includes an amount that was also reported on line 7 (Form 1040), subtract that amount from the amount on line 7 (Form 1040) and enter the result in the first space of the worksheet in Step 5 of the Form 1040 instructions for lines 64a and 64b. File 2007 taxes online Put “Clergy” on the dotted line next to line 64a (Form 1040). File 2007 taxes online Church employees. File 2007 taxes online    A church employee means an employee (other than a minister or member of a religious order) of a church or qualified church-controlled organization that is exempt from employer social security and Medicare taxes. File 2007 taxes online If you received wages as a
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