The Earned Income Tax Credit (EITC) it is a financial stimulus that the IRS grants to certain families with low or moderate income. And this year, following an ongoing pandemic that led to severe economic decline and the loss of hundreds of thousands of jobs, millions of taxpayers could claim it for the first time due to changes in their marital, financial or parental status.
The EITC is a refundable tax credit. This means that workers can get money back, even if they don’t owe taxes.
The tax agency encourages workers who earned $ 56,844 or less in 2020 to check the criteria. This includes people who work for someone or who have their own business.
Use the IRS digital tool, EITC Assistant, to inform you about the process, which can be complex in some cases. The agency also encourages all workers to seek free tax help through the program. Free File del IRS, or in a local free tax preparation site.
These sites are staffed with IRS-trained community volunteers who help process credit for families in greatest need.
The IRS estimates that one in five taxpayers who meet the criteria do not claim the credit.
“For more than 45 years, this tax credit has helped hard-working Americans and their families. We want to thank our partners across the country who help us reach low- and moderate-income individuals who may qualify and not even know it, ”IRS Commissioner Chuck Rettig said in a statement on the occasion of the Day to Raise Awareness on EITC last weekend.
“If your earned income was higher in 2019 than in 2020, you can use the 2019 amount to calculate your EITC for 2020. This temporary relief is provided as provided in the Taxpayer Certainty and Disaster Relief Act of 2020”, clarified the IRS on their website.
The tax agency emphasizes that families with children can receive up to more than $ 6,000 in reimbursement
Last year, more than 25 million taxpayers received more than $ 62 billion in EITC; while the average amount for the credit was $ 2,461. A family with three or more children could receive up to $ 6,660 this year, and up to $ 538 in the case of taxpayers without children who qualify.
IS THE CREDIT GRANTED TO UNDOCUMENTED?
To claim the EITC, the taxpayer and their spouse (if filing a joint return) must be United States citizens or green card holders.
If you or your spouse were a nonresident alien at any time during the tax year, you can claim the EITC only if your filing status is married filing jointly and you or your spouse is:
- Citizen of the United States with a valid Social Security number.
- Resident alien who was in the United States for at least six months of the tax year and has a valid Social Security number.
Individuals with a Personal Taxpayer Identification Number (ITIN) do not qualify.
The IRS will begin processing tax returns on February 12. The general recommendation is that taxpayers complete the process online and request direct deposit so that the refund is delivered expeditiously.
HERE YOU WILL FIND information in Spanish.
A married couple with three children and an Adjusted Gross Income of $ 56,844 or less would receive up to $ 6,660 on their tax return in 2021. A person who earns $ 15,820 and has no children can receive up to $ 538.
CAN THE EITC FROM PREVIOUS YEARS BE APPLIED?
Yes, but keep in mind that you can only apply for the EITC for the last three years prior. The deadlines to do so are the following:
- For 2016, if you file your tax return before July 15, 2020.
- For 2017, if you file your tax return before April 15, 2021.
- For 2018, if you file your tax return before April 15, 2022.
Source: Telemundo
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