Updated: Dec 1, 2019
A refundable individual income tax credit for certain persons who work.
The earned income credit increased for the tax year 2019. The maximum EIC for the tax year 2019 is $6,557 with three or more qualifying children, $5,828 with two qualifying children, $3,526 with one qualifying child,* and $529 with no qualifying children.
The maximum amount of income a taxpayer can earn and still receive the earned income credit (EIC) increased for the tax year 2019. If a taxpayer’s earned income reaches or exceeds the following amounts, he will not be eligible for the EIC. See the following charts.
If the taxpayer has: The Earned Income Amount is:
No children $ 6,920 - $8,650 ($14,450 MFJ)
One child $10,370-$19,030 ($24,820 MFJ)
Two children $14,570-$19,030 ($24,820 MFJ)
Three or more qualifying children $14,570-$19,030 ($24,820 MFJ)
If the taxpayer has: He will be ineligible for EIC if his income is
No children $15,570 (MFJ – $21,370) or more
One child $41,094 (MFJ – $46,884) or more
Two children $46,703 (MFJ – $52,493) or more
Three or more qualifying children $50,162 (MFJ – $55,952) or more
Married Filing Separately taxpayers are not eligible for the EIC.
A taxpayer may be able to take the credit if his AGI is less than the amount above that applies. The maximum amount of investment income a taxpayer can receive and still get the credit has increased to $3,600.
Married Filing Separately taxpayers are not eligible for EIC.
Allen and Jason are married. Their two dependent children are all under age 17 at the end of 2019. They had W-2 wages of $51,200 and dividend income of $3,680. Allen and Jason always file jointly. Because their dividend income of $3,680 exceeds the investment income limitation of $3,600, they are not eligible to claim the EIC in the tax year 2019.
(for purposes of the child tax credit): A child who meets all of the following qualifications:
1. Under age 17 at the end of the tax year
2. A citizen or resident of the United States
3. Did not provide over half of his own support for the tax year
4. Lived with the taxpayer for more than half of the tax year
5. Has one of the following relationships to the taxpayer:
• Son or daughter
• Stepson or stepdaughter
• Brother or sister
• Stepbrother or stepsister
• Any descendant of any of the above (for example, grandchild **), or
• Eligible foster child
*An adopted child placed with the taxpayer by an authorized placement agency for legal adoption is an adopted child even if the adoption is not final.
**A grandchild is considered to be any descendant of the taxpayer’s son, daughter, or adopted child and includes great-grandchildren, great-great-grandchildren, etc.
(for purposes of dependent): There are six tests that must be met for a child to be the taxpayer’s qualifying child. The six tests are:
5. Joint return
6. Special test for qualifying child of more than one person