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Earned Income Credit and the Child Tax Credit
Low- and moderate-income families may benefit from two substantial tax credits - the Earned Income Credit and the Child Tax Credit.
If you worked during 2009 and earned a low or moderate income, you may be eligible for the Earned Income Tax Credit (EIC), a special tax benefit for full-time, part-time, and temporary workers.
Claiming the EIC will mean that you will owe less in taxes, and you could get extra money back - from both the federal and the state government. Payments vary based on income and family size.
Many families will get up to $6,000 this year. You can claim the EIC even if you do not owe income taxes; however, you must file federal and state tax returns.
Households with children should file federal form 1040 or 1040A, not form 1040EZ. Be sure to attach Schedule EIC.
Households may qualify for the federal and state EIC if, in 2009, you:
- Earned less than $35,463* and have one dependent child.
- Earned less than $40,295* and have two dependent children.
- Earned less than $43,279* and have three or more dependent children.
- Earned less than $13,440,* are between ages 25 and 64 and do not have dependent children.
* Income limit for married workers is $5,000 higher.
In Maryland, the EIC does not affect benefits such as food stamps, Medicaid, public housing, cash assistance, or SSI.
Families that earned more than $8,500 in 2009 may also be eligible for the refundable Child Tax Credit on their federal tax return. To claim the Child Tax Credit, file federal form 1040 or 1040A, not form 1040EZ. Be sure to attach IRS Form 8812, "Additional Child Tax Credit."
For more information about the EIC and locations for FREE tax preparation, call the United Way of Central Maryland's "First Call for Help" referral service at 2-1-1 or 1.800.492.0618. TTY is available at 410.685.2159.
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