TurboTax says my earned income is too high for the EIC. The IRS website uses AGI which means I qualify, but TurboTax only uses earned income so I don’t qualify. Thoughts?

[ras5258]

My earned income is $63k. I paid $6k in health insurance premiums with brings my AGI to $57k. You need a $58k AGI to qualify for the EIC per the IRS Website. TurboTax says I don’t qualify based on earned income. The IRS Website says I do based on AGI. (I can also make contributions to a 401k/HSA to bring this number down and qualify, but I should already qualify based on my health insurance premiums. Does anyone know what to do on TurboTax to qualify?

[xmasbaby0]

Not sure why you think paying health insurance premiums reduces your AGI to $57K.  Your AGI is shown on line 11 of your Form 1040.    TurboTax is following the tax laws when it calculates whether you are eligible for EIC.   

You have not mentioned your filing status or whether you have dependent children -- or how many children you have.

 Earned Income Credit—-the rules are back to the “old” rules—

Those under 25 and over 65 without children are not eligible as they were uniquely in 2021.   And you cannot use your income from any earlier tax year to get the EIC for a 2022 return.  There is no “lookback” for 2022.  EIC for 2022 will be based on the income you earned by working in 2022.

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

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

Look at your 2022 Form 1040 to see the child-related credits you received

PREVIEW 1040

https://ttlc.intuit.com/questions/1901539-how-do-i-preview-my-turbotax-online-return-before-filing

Child Tax Credit line 19

Credit for Other Dependents line 19

Earned Income Credit line 27

Additional Child Tax Credit line 28

[DoninGA]

You must meet all the rules for EIC, including AGI and Earned Income

IRS Publication 596 Earned Income Credit (EIC) - https://www.irs.gov/pub/irs-pdf/p596.pdf

Rule 1—Adjusted Gross Income (AGI) Limits
Your adjusted gross income (AGI) must be less than:
• $53,057 ($59,187 for married filing jointly) if you have
three or more qualifying children who have valid
SSNs,
• $49,399 ($55,529 for married filing jointly) if you have
two qualifying children who have valid SSNs,
• $43,492 ($49,622 for married filing jointly) if you have
one qualifying child who has a valid SSN, or
• $16,480 ($22,610 for married filing jointly) if you don't
have a qualifying child who has a valid SSN.

Rule 15—Earned Income Limits
Your earned income must be less than:
• $53,057 ($59,187 for married filing jointly) if you have
three or more qualifying children who have valid
SSNs,
• $49,399 ($55,529 for married filing jointly) if you have
two qualifying children who have valid SSNs,
• $43,492 ($49,622 for married filing jointly) if you have
one qualifying child who has a valid SSN, or
• $16,480 ($22,610 for married filing jointly) if you don't
have a qualifying child who has a valid SSN.

[Bsch4477]

For EIC you have to meet the income criteria for both earned income and AGI. 

[JohnB5677]

Let's start by letting you take a look at your 1040.  The Adjusted Gross Income, also called earned income.  Is the number the IRS uses for the EIC calculation. 

This number is on line 11 of your tax return.  That is before you get any deductions, so very often the Adjusted Gross Income it is the same as total income.

To see a preview of your taxes:

1. On the menu bar on the left that shows.
   1. My Info
   2. Federal
   3. State
   4. Review
   5. File
2. Select Tax Tools
3. On the drop-down select Tools
4. On the popup menu
5. Select View Tax Summary
6. On the left sidebar
7. Select Preview my 1040.

Line 11  - Adjusted Gross Income

Line 15 - Taxable Income

Line 24 - Total Tax.

Line 25 - Withholdings.

Line 33 - Payments including Credits.

Line 34 - Overpayments.

Line 37 - Tax owed.

To return to the entry screens press Back on the sidebar.

[anaathome]

Hello, 

I have a similar situation. My AGI is $55488, but I have an Interest income from my bank of $84, which pushes my AGI over the limit for married filing jointly 2 children. But when I do the EITC Assistant quiz online https://apps.irs.gov/app/eitc/general-info/ it says I qualify because it reduces the AGI to $54669 after adding in 403b contributions and Roth IRA contributions. Is the IRS assistant not correct in doing this or is Turbo Tax not allowing me the credit? 

Thank you for any help in this credit. 

[DoninGA]

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@anaathome wrote:

Hello, 

I have a similar situation. My AGI is $55488, but I have an Interest income from my bank of $84, which pushes my AGI over the limit for married filing jointly 2 children. But when I do the EITC Assistant quiz online https://apps.irs.gov/app/eitc/general-info/ it says I qualify because it reduces the AGI to $54669 after adding in 403b contributions and Roth IRA contributions. Is the IRS assistant not correct in doing this or is Turbo Tax not allowing me the credit? 

Thank you for any help in this credit. 

---

Your 2022 AGI and your earned income must be less than maximum AGI, investment income and credit amounts for tax year 2022 for your filing status.

Go to this IRS website for the 2022 EIC tables - https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/earned-income-and-earned...

[anaathome]

Hello, thank you for replying. Yes, I saw the table, but the IRS assessment deducted from the AGI so it is confusing as to why the IRS website would say I qualify by allowing the AGI to be lowered. 

[RobertB4444]

Because the IRS system didn't know that the 403B contributions had already been removed from your income on your W2.  It was asking about additional contributions not on your paycheck.  So when you entered the amount there you were actually getting double credit.

TurboTax is a really solid tax calculator.  You almost certainly don't qualify for the EIC.

But on the upside the IRS is actually quite good about correcting your tax return and giving you an EIC that you qualified for but left off of your tax return.  So if there is some error that would allow you to qualify for the EIC the IRS will almost certainly catch it.

@anaathome