EITC – an acronym of Earned Income Tax Credit – is a refundable tax credit, which is available primarily for the families and individuals having low to moderate income. It is also known as Earned Income Credit (EIC) and is fairly a substantial tax credit, which can assist you if you have a low income. Families and individuals who have qualifying children can even receive greater tax credit. When the tax credit goes beyond the amount of billed taxes, a tax refund will be provided to the families and individuals who claim and qualify for the credit. This can help to give an incentive to work and to counterbalance the burden of social security taxes. So on the whole, EITC can reduce your taxes or else can benefit you with a tax refund if you qualify for that.
There are some criteria required to get the Earned Income Tax Credit:
- You must be single, qualifying widow, head of household, or married and filing jointly; you cannot file separately if you are married
- You must have earned income; and this also concerns if you are self-employed
- You, your partner, and any eligible children must contain valid social security numbers
- Even if you don’t have children, you may still qualify
- Eligible children must be below the age of 18 at end of the tax year, except they are a full time student
- You must be a citizen of US
- You can’t be an eligible child on somebody else’s return
The amount of your Earned Income Tax Credit will vary depending on your family size and income levels. There are some online tax preparation tools available by using which you can calculate your EITC and estimate your tax refund automatically. Just checkout some free Earned Income Tax Credit Calculator tools provided below to see whether you qualify for EITC or not.
Online Tools to calculate Earned Income Tax Credit (EITC)
The EITC Assistant tool at irs.gov can assist you to verify if you are eligible to claim the EITC, and to calculate the amount of the credit or refund. With the help of this tool, you are able to determine your filing status, your eligibility, the status of your child as a qualifying child, and the calculated amount of your credit. There are 3 topics provided to start with. Firstly, you can determine whether you are eligible for the EITC, and if you are eligible then you can determine whether you can claim the credit or not, depending on your income and filing status. If you don’t know your filing status, you can get it using the Interactive Tax Assistant tool provided there. Secondly, you can find out if your child is a qualifying child or not by following some tips and guidance and then providing the required information. And lastly, you can estimate the amount of your credit or refund by just following the directions and providing the required information, which includes the type & amount of income you received for the previous tax year and any amendments to that income.
The Turbotax Earned Income Tax Credit Calculator given at the site eitc.intuit.com helps you to quickly find out if you are eligible for EITC to prepare and file your credit. Here, you can find results for both Federal Earned Income Tax Credit and State Earned Income Credit. Firstly, you need to select your filing status and your state, and enter your annual income. Here, there is no availability to find the status of your child as a qualifying child, you have to determine on your own if your child is qualifying or not. You will go through some selective questions and then you will be asked to fill up some other income options to estimate your adjusted gross income. Once you have done, click on ‘calculate’, and you will get the calculated amount for both your Federal EITC and State EITC.
The Earned Income Tax Credit Estimation tool at dinkytown.net is another service, which helps to find out the eligibility and to estimate the EITC amount. Besides this estimation service, this tool also provide the deep descriptive info about EITC associated contents with definitions including filing status, qualifying of children, earned income and other incomes with adjusted gross income, etc. As with above tool, here you have to select your filing status and number of your qualifying children, and enter the earned annual income and other incomes. You will be required to do the adjusting of your gross income on your own. After that, just go through few selective questions, and click on ‘calculate’, that’s it. You will be provided with the amount of your EITC as well you can view the report of your result summary by clicking on ‘view report’.
Calculate and estimate your EITC amount using “Tax Calculator” and “TaxStimator” at efile.com before preparing and filing for credit. To start estimating your tax credits with the tax calculator, choose your filing status, select your exemptions for yourself, your partner, your dependents, and go ahead with ‘next’ button. Now, you are required to fill out your Income Information by using the sliders or you can also enter numbers manually. Entering info about your Personal Deductions and your already paid amounts is the next requirement. And you will be provided with the estimated amount of your tax credit or else tax refund, with the entire review of your tax information.
Earned Income Tax Credit Estimator at the site cbpp.org is just a calculation tool intended to exemplify what the EITC might be worth to you. At the homepage itself, you will find two options – single and married, with the sub options like no child, 1 child, 2 children and 3 or more children. Just select the option in which you fit, then you will be asked to enter your Earnings. That’s it – no other questions asked and information to enter. You will directly get the estimated amount of your Earned Income Tax Credit. This amount is just an idea about your credit worth, which can be altered when you claim your credit.
All the tax calculator tools explained above are free of charge and the information you provide on each tool will be discarded when you exit the program, so all of them are safe.