Take advantage of Earned Income Tax Credit
Countdown Tip No. 7: Check out the Earned Income Tax Credit.
Do you qualify for the Earned Income Tax Credit? Many Utahns do and never take advantage of it.
Essentially, the EITC is a refundable tax credit designed to help low-income workers. If you are employed, self-employed or a farmer and earned less than $51,000 in 2012, you could qualify. Because it's a tax credit, you could get money back even if you had no tax withheld.
To qualify, a taxpayer must:
Have earned income. What qualifies? Could be wages, salary and tips. Could be long-term disability income or strike benefits. But it's definitely not Social Security, alimony or unemployment benefits. Retirement pensions don't count, either. Check IRS.gov for all the details.
Have a valid Social Security number.
Not be married filing separately.
Not be a qualifying child of another taxpayer.
The amount of the credit depends on your income and family size, with a maximum credit of $5,891 for those with three or more qualifying children.
According to the Internal Revenue Service, more than 190,000 Utahns qualified for the EITC in 2011, with an average credit of $2,247. But the agency estimates that about 20 percent of taxpayers missed out on this credit because they didn't file for it. To see if you qualify, check out the EITC calculator at IRS.gov.
Coming up Tuesday: Don't miss out on the Child and Dependent Care Credit.
Countdown to April 15 last-minute tips
Haven't filed your taxes yet? Check out The Tribune's Countdown to Tax Day series with information that can help as the deadline approaches:
April 4 • Where to get free help
April 5 • How to avoid tax scams
April 6 • The joys of filing electronically
Today • What's the Earned Income Tax Credit?
Tuesday • Don't miss out on the Child and Dependent Care Credit
Wednesday • Understand your taxes if you're self-employed
Thursday • Watch out for fees when paying taxes by credit card
Friday • Reduce your taxes by saving for retirement
Saturday • Use the Taxpayer Advocate when tackling the IRS
April 14 • Don't ignore your taxes; file an extension to get more time