EIC. Is only wages counted or is adjusted gross income counted including money taken out of a traditional IRA?

[xmasbaby0 · Accepted solution]

The figure used to calculate your EIC would include any distribution you took from an IRA.

To receive the EIC the income must be EARNED income; unemployment compensation does not count.  You cannot have investment income over $3400, and you must be a U.S. citizen or resident alien for the whole tax year. You must have a valid Social Security number.  Your filing status cannot be married filing separately.  If you are a single filer with no dependents, you must be between the ages of 25 to 65.

There is a table that starts on page 30 of IRS publication 596 regarding EIC and the amount you can receive for your earned income:

www.irs.gov/pub/irs-pdf/p596.pdf