If unemployment insurance is not earned income why is it added to wages increasing the AGI amount?

[Carl]

Your AGI (Adjusted Gross Income) is not limited to earned income by any stretch of the imagination.

[Rachel_W · Accepted solution]

More than just your Earned Income goes into the calculation of the Earned Income Credit.  

Non-earned income such as scholarships, unemployment compensation and investment income that are included in your Adjusted Gross Income (AGI) also factor into the calculation.  

Click here to view the IRS calculation worksheet for the EIC: 2018 EIC Worksheet.