If you qualify for the EIC and have entered all information correctly then it will show on your 1040, Line 27, Earned Income Credit (EIC). You can view this in the Forms mode. To get to the Forms mode in Turbo Tax look for the Forms Icon in the upper right of the TurboTax screen. Then browse the forms in the left column.
The general eligibility rules for the EITC are fairly straightforward:
- Taxpayers must file as individuals or married filing jointly.
- If married, you, your spouse and your qualifying children must have valid Social Security numbers.
- You must also be 25 or older but younger than 65.
Although the EITC typically is considered a credit for low-income filers, there are many variations of income, filing status and number of qualifying dependents that affect eligibility. For example:
- In 2020, a married couple with three children and adjusted gross income of $56,844 or less could receive up to $6,660.
- An individual who earns $15,820 and has no children may receive up to $538.
It's recommended that all filers explore their eligibility for receiving the EITC each year. For the 2020 tax year, the maximum credit is $6,660. According to the Internal Revenue Service, the average amount credited in 2018 was $2,488.
2. Self-employed still counts
Many filers, especially self-employed individuals, fail to take advantage of credits because they think they are ineligible.
The IRS considers all income that is earned eligible for the credit. That includes:
- Wages
- Salaries
- Tips
- Union strike benefits
- Long-term disability benefits received prior to minimum retirement age
- Net earnings from self-employment
- Gross income received as a statutory employee (an independent contractor under common law rules)
Types of income that do not qualify as earned income for the credit include:
