If you feel lost in the sea of acronyms surrounding tax time, you’re N.O.T. alone. The biggest mistake would be letting the frenzy make you miss out on the tax credit MONEY you deserve (if anything deserves to be in caps, it’s MONEY, right?)
The biggie is the Earned Income Tax Credit (abbreviated as both EITC or EIC). EITC is a benefit especially for families with low or moderate income. The government created it to offset the burden of Social Security taxes (the money that comes out of your paycheck each time) and provide an incentive to stay in the workforce.
(1) Take this seriously, because this is like additional income!
It’s not a deduction, it’s like an extra paycheck. So it’s VERY worth it to investigate whether you can get this credit. If you spend even 2 hours looking into this, it’ll be time well spent. For the 2015 tax year, the maximum credit was $6,242.
(2) Get the scoop on what eligibility looks like this year, but check back! It could change every filing year.
Maybe you didn’t get it last year, you could get it this year. Tax laws change, it’ll be smart to check again.
For Tax year 2015: Taxpayers must file as individuals or married filing jointly. If married, you, your spouse and your qualifying children must have valid Social Security numbers. You must be between ages 25-65.
(3) Pay attention to the boxes you’re checking!
If you use an online tax software, it can do the investigation for you – surfacing the Earned Income Tax Credit if you qualify. If it’s not saying you qualify, you can always check the EITC Assistant on the IRS.gov website. Also, you can find a qualified tax preparer in your neighborhood if you want someone to walk you through it – try searching at IRS.gov/chooseataxpro.