You are correct. This tax credit can wipe out some, if not all, of your tax liability if you end up owing the IRS. This is especially helpful if you have self-employment income, on which extra taxes are due, or some other tax liability. As the years have gone by, the Standard Deductions have gone up, but not the income limits, so some folks like you (one over 65, and one under 65) get caught in a Catch 22. But it does work for Singles over 65, and Married Couples where both are over 65.
