MinhT1
Expert Alumni

Deductions & credits

One probable reason is that some income-based credits such as the earned income credit will decrease when you enter more expenses and decrease your taxable income.

 

The Earned Income Tax credit (EITC) is a bell shaped curve against income. The EITC rises with income until a certain level of income when it starts to decrease to reach 0 at the maximum level of income for the category.

 

As an example, please look at the EITC tables from page 28 of this IRS publication.

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