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Yes, it's the amount of your earnings. I will try to explain some of the reasons for you.
First the Earned Income Tax Credit: The Earned Income Credit (EIC) is not looking at your taxable income, rather it is looking at the earned income on the return and the adjusted gross income to determine the amount of the credit. Earned income is money earned from any source where a service is performed either as an employee or a self employed individual.
The purpose of this credit is to help those people who are trying to make ends meet and working hard to accomplish that goal while working their way out of poverty. First the tax return looks at the earned income, then the adjusted gross income.
Beginning from $1 - $53,505 (2017 Table amounts) depending on filing status and the number of children it's likely you'll have EIC. The closer you get to the mid range the higher the credit and as your income increases the need is not as great and the credit is slowly reduced until out of range. For these reasons the credit can change dramatically from year to year. Click this link for more information.
Second, the Additional Child Tax Credit (this is the refundable portion if you don't have tax liability:(
The Additional Child Tax Credit is a refundable credit that you may receive if your Child Tax Credit is greater than the total amount of income tax liability, as long as you had an earned income of at least $3,000. In other words the Child Tax Credit reduces your tax to zero before you are eligible for the refundable ACTC. The earned income rule continues to apply.
In this particular case where the Child Tax Credit and the Additional Child Tax Credit are referenced it's discussing two different credits. First the Child Tax Credit, a nonrefundable credit, will reduce the tax liability to zero before applying the ACTC. (This would require income to have any tax liability.) Any excess, provided there is earned income of at least $3,000, can be refunded.
Yes, it's the amount of your earnings. I will try to explain some of the reasons for you.
First the Earned Income Tax Credit: The Earned Income Credit (EIC) is not looking at your taxable income, rather it is looking at the earned income on the return and the adjusted gross income to determine the amount of the credit. Earned income is money earned from any source where a service is performed either as an employee or a self employed individual.
The purpose of this credit is to help those people who are trying to make ends meet and working hard to accomplish that goal while working their way out of poverty. First the tax return looks at the earned income, then the adjusted gross income.
Beginning from $1 - $53,505 (2017 Table amounts) depending on filing status and the number of children it's likely you'll have EIC. The closer you get to the mid range the higher the credit and as your income increases the need is not as great and the credit is slowly reduced until out of range. For these reasons the credit can change dramatically from year to year. Click this link for more information.
Second, the Additional Child Tax Credit (this is the refundable portion if you don't have tax liability:(
The Additional Child Tax Credit is a refundable credit that you may receive if your Child Tax Credit is greater than the total amount of income tax liability, as long as you had an earned income of at least $3,000. In other words the Child Tax Credit reduces your tax to zero before you are eligible for the refundable ACTC. The earned income rule continues to apply.
In this particular case where the Child Tax Credit and the Additional Child Tax Credit are referenced it's discussing two different credits. First the Child Tax Credit, a nonrefundable credit, will reduce the tax liability to zero before applying the ACTC. (This would require income to have any tax liability.) Any excess, provided there is earned income of at least $3,000, can be refunded.
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