The lookback rule is part of the Coronavirus tax relief package.
The lookback rule applies for tax year 2020 to both the Earned Income credit and the refundable part of the Child tax credit.
It has not been extended for tax year 2021.
The special lookback rule will allow lower income individuals to use their earned income from 2019 to determine their Earned Income Tax Credit and the refundable portion of the Child Tax Credit in 2020, since their lower 2020 income could reduce the amount they are eligible for.
Please read this TurboTax blog for more information.
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