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My child was born march 2020. Why would I use 2019 taxes to claim him?

what is non taxable combat pay
2 Replies
Employee Tax Expert

My child was born march 2020. Why would I use 2019 taxes to claim him?

If using your 2019 income for getting earned income credit gives you a bigger tax refund you are allowed to use 2019's earned income amount.  For some people that will make a big difference, since so many have been on unemployment for 2020.  Go slowly and carefully through the earned income credit section.  You are not required to use the 2019 amount--you have a choice.


Earned Income is salaries, wages, professional fees, and other amounts you earn for work actually performed. This includes tips or any taxable scholarship/fellowship grants that were reported on Form W-2.


Generally, earned income includes amounts reported on Form 1040 for wages, salaries, tips, income from your own business (on Schedule C), end income from your own farm (Schedule F).


If you are using a prior year income to figure your EIC or ACTC, you must enter the amount of non-taxable combat pay.   Combat pay is income earned while stationed in a designated combat zone in service to the U.S. military.  Combat pay is nontaxable for most service members, and all service members can exclude at least some of their combat pay from their taxable income.


To find the amount of your nontaxable combat pay, see your Form W-2, box 12 with code Q.

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Level 15

My child was born march 2020. Why would I use 2019 taxes to claim him?

Congress spends a lot of time adding wacky exceptions, loopholes and other special cases on to the tax code.

Most people know nothing about them.

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