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How does the earned income tax credit work?
If you have a relatively low income or if you earn a moderate amount of income but must support children, you may be eligible for the earned income tax credit. This credit can provide a refund even if you had little or no income tax withheld from your pay. To qualify, you must be age 25 or older and not be claimed as a dependent on someone else’s tax return.
In 2008, you may qualify for this credit if your income is below the following limits:-
If you have no children living with you: $12,880 ($15,880 if married filing jointly).
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If one child lives with you: $33,995 ($36,995 if married filing jointly).
- If two or more children live with you: $38,646 ($41,646 if married filing jointly).
In 2009, you may qualify for this credit if your income is below the following limits:-
If you have no children living with you: $13,440 ($16,560 if married filing jointly).
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If one child lives with you: $35,463 ($38,583 if married filing jointly).
- If two or more children live with you: $40,295 ($43,415 if married filing jointly).
These income limits rise each year with inflation. For more information, see Publication 596, Earned Income Credit on the IRS Web site.Return to Questions
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