topic My AGI is less than the limit of $56,844 when filing as married filing jointly with 3 children. Does EIC generates based on 'earned income' or 'AGI'? in Get your taxes done using TurboTax

My AGI is less than the limit of $56,844 when filing as married filing jointly with 3 children. Does EIC generates based on 'earned income' or 'AGI'?

jkim0002 — Sun, 28 Feb 2021 08:24:34 GMT

Re: My AGI is less than the limit of $56,844 when filing as married filing jointly with 3 children. Does EIC generates based on 'earned income' or 'AGI'?

xmasbaby0 — Sun, 28 Feb 2021 14:18:25 GMT

https://ttlc.intuit.com/questions/1899157-what-are-the-qualifications-for-the-earned-income-credit-eic-or-eitc

https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/use-the-eitc-assistant

You might need to use the 2019 lookback for EIC to see if it helps:

Many people had lower incomes during the pandemic in 2020 due to reduced work hours, layoffs, etc. Or they received unemployment benefits. These factors affect how much earned income credit and additional child tax credit you can get on your 2020 tax return and affect your 2020 refund.

There is a “lookback” option that allows you to use your 2019 amounts for earned income credit or child tax credit. You can choose whether to use your 2019 amount or your 2020 amount. Choose whichever amount gives you a better tax refund for your 2020 refund.

You can see this and choose in the earned income credit section in Deductions and Credits.

You still MUST enter all of your 2020 income into your 2020 tax return, including any unemployment you received.

Please follow these steps in TurboTax:

Login to your TurboTax Account
Click on the Search box on the top and type "EIC"
Click on “Jump to EIC”
Answer the questions until you reach the screen "Do you want to use last year’s earned income?"
Note your current refund amount using your 2020 earned income at the top of the screen.
Click "Yes", enter your "2019 Earned Income" if the field is blank and click "continue".
Compare the new refund amount using your 2019 earned income with the previously noted refund amount using your 2020 earned income.

Re: My AGI is less than the limit of $56,844 when filing as married filing jointly with 3 children. Does EIC generates based on 'earned income' or 'AGI'?

jkim0002 — Wed, 03 Mar 2021 19:13:56 GMT

Thanks for the response,

The turbo tax system tells us that we are not entitled to receive EIC, but we are with 3 qualifying children with AGI less than the limit. How can we resolve this issue? Thanks

Re: My AGI is less than the limit of $56,844 when filing as married filing jointly with 3 children. Does EIC generates based on 'earned income' or 'AGI'?

jkim0002 — Wed, 03 Mar 2021 19:33:52 GMT

In addition to EIC,

Turbotax said, " It turns out you don't qualify for this credit." because my earned income is above the limit of EIC.

From IRS, AGI should be considered instead of 'earned income'. My current AGI is less than the limit of EIC.

Can you please explain why system uses my 'earned income' instead of 'AGI'...?

Thanks

Re: My AGI is less than the limit of $56,844 when filing as married filing jointly with 3 childre...

npierson7 — Wed, 03 Mar 2021 19:52:05 GMT

To claim the Earned Income Tax Credit (EITC), you must have what qualifies as earned income and meet certain adjusted gross income (AGI) and credit limits for the current, previous and upcoming tax years. Earned income includes all the taxable income and wages you get from working for someone else, yourself or from a business or farm you own. If your income came form other sources, like unemployment benefits, and you didn't have any wages. you are not qualified for the credit, even if your AGI is low.