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traceyleevi5
New Member

Why don't grandparents who feed and clothed the children why there parents are gone off to do drugs dont qualify for earned income credit for the child they care for all year

this is 2018 not many parents are being parents any more
4 Replies
SweetieJean
Level 15

Why don't grandparents who feed and clothed the children why there parents are gone off to do drugs dont qualify for earned income credit for the child they care for all year

Do Grandparents have income for working?
SweetieJean
Level 15

Why don't grandparents who feed and clothed the children why there parents are gone off to do drugs dont qualify for earned income credit for the child they care for all year

As an aside, petition the Court for guardianship.
Opus 17
Level 15

Why don't grandparents who feed and clothed the children why there parents are gone off to do drugs dont qualify for earned income credit for the child they care for all year

To claim the earned income credit, you must first claim the children as dependents.  This means the children must live in your home more than half the nights of the year.  If the children also lived with their parents more than half the nights of the year (because you all live together at least some of the time) then the parents get first claim and must agree to allow the grandparents to claim the children.

Then second, to get the earned income credit you must have earned income.  Earned income is income earned from working (performing a service for money.)  Unearned income, which include things like retirement pay, most rental income, dividends and capital gains from sale of stock, gambling prizes, and so on, doesn't count for the EIC.  And in fact, if your unearned income is too high, then you are disqualified from EIC even if you also have earned income.

The concept is that EIC is intended to help young (poor) working families who are starting at the bottom of the income ladder.  If you have large amounts of unearned income from investments or rental property, then you probably aren't "poor", and if you aren't "Working" to get earned income, then you don't get a credit designed for workers.

(To go into even more detail, EIC started out as a rebate of social security tax, because even though the income tax is "progressive" and the poorest hard working people might owe no income tax, social security tax is "regressive" because every pays the same, even the very poor, and high income workers pay less.  So EIC was a rebate of social security tax based on the concept of earned income.  Unearned income is not subject to social security tax, so it isn't eligible for the rebate.)

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
SweetieJean
Level 15

Why don't grandparents who feed and clothed the children why there parents are gone off to do drugs dont qualify for earned income credit for the child they care for all year

Good background explanation.
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