Friday, January 29, 2016

On the 10th Anniversary EITC Awareness Day: IRS Alerts Workers of Significant Tax Benefit

WASHINGTON — The Internal Revenue Service joins partners across the country in promoting the Earned Income Tax Credit on EITC Awareness Day, Friday, January 29, 2016. This is the 10th anniversary of the EITC Awareness Day campaign, a nationwide effort to alert millions of low and moderate-income workers who may be missing out on this significant tax credit.

Millions of taxpayers who earned $53,267 or less last year may qualify for EITC for the first time in 2016, making awareness critical. Local officials and community organizations nationwide are holding events on EITC Awareness Day highlighting this key benefit.

“One-third of the population eligible for EITC changes each year as their personal circumstances change,” said IRS Commissioner John Koskinen. “We want workers who may qualify for EITC for the first time to have all the information they need to get the EITC and get it right. This is an important credit for hard-working Americans, and one of the government’s best tools to fight poverty.”

Last year, more than 27.5 million eligible workers and families received almost $66.7 billion in EITC; with an average EITC amount of more than $2,400. is a valuable first stop to help taxpayers get it right this filing season, from information on claiming the EITC, to learning about the Affordable Care Act (known as the health care law), to finding free tax help and preparation for qualified taxpayers. The IRS encourages everyone to use the EITC Assistant, an interactive tool on, to find out if they are eligible for the credit. The IRS website also provides helpful information on the health care law and how it may affect tax returns at

Workers, self-employed people and farmers who earned $53,267 or less last year could receive larger refunds if they qualify for the EITC. Eligible families with three or more qualifying children could get a maximum credit of up to $6,242. EITC for people without children could mean up to $503 added to their tax refund. Unlike most deductions and credits, the EITC is refundable. In other words, those eligible may get a refund from the IRS even if they owe no tax.

The IRS reminds taxpayers to be sure they have valid Social Security numbers in hand for themselves, as well as each qualifying child, before they file their return. Moreover, to get the EITC on a 2015 return, they must get these SSNs before the tax-filing deadline (April 18, 2016 for most people or Oct. 17, 2016 for those who get extensions).

Workers potentially eligible to claim the credit should visit to learn if they qualify and how to claim the credit. The IRS recommends that all workers who earned around $54,000 or less use the EITC Assistant to determine their filing status, if they have a qualifying child or children, if they qualify to receive the EITC and estimate the amount of the EITC they could get. If an individual doesn’t qualify for EITC, the Assistant explains why. A summary of the results can be printed and kept with the worker’s tax papers.

The IRS also reminds taxpayers about the availability of myRA, a new, free, retirement savings account from the Treasury Department. Taxpayers who have a myRA account may use Free File to deposit their tax refund or a portion of their refund into their myRA account. They just need to use Form 8888 or follow their software product’s instructions.

Get the Credit: How to Claim the EITC

To get the EITC, workers must file a tax return, even if they are not required to file, and specifically claim the credit. Free tax help is available. Those eligible for the EITC have these options:
  • Free File on Free brand-name tax software walks people through a question and answer format to help them prepare their returns and claim every credit and deduction for which they are eligible. Free File also provides online versions of IRS paper forms, an option called Free File Fillable Forms which is best suited for taxpayers comfortable preparing their own returns.
  • Free tax preparation sites EITC-eligible workers can seek free tax preparation at thousands of Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) sites. Taxpayers can locate the nearest site using a search tool on or through the IRS2go smartphone application.
It is important for taxpayers to bring along all the required documents and information to make sure they get the EITC they deserve.

The IRS issues more than 9 out of 10 refunds in less than 21 days. However, it’s possible a tax return may require additional review and take longer. Taxpayers can track the status of their refund with the “Where’s My Refund?” tool available on or on IRS2go.This online tool has the most up to date information available about a refund.

Get It Right: Avoid Errors

Taxpayers are responsible for the accuracy of their tax return even if someone else prepares it for them. The rules for EITC are complicated. The IRS urges taxpayers to seek help if they are not sure they are eligible either from a paid tax professional or at a free tax return preparation site. Deliberate errors can have lasting impact on future eligibility to claim EITC and leave taxpayers with a penalty.
Taxpayers should reply promptly to any letter from the IRS requesting additional information about EITC. If taxpayers need assistance or have questions, they should call the number on the IRS letter.

Beware of Scams

EITC provides a financial boost for millions of hard-working Americans. However, a deliberate error can have lasting impact on future eligibility to claim EITC. Beware of scams that claim to increase the EITC refund. Scams that create fictitious qualifying children or inflate income levels to get the maximum EITC could leave taxpayers with a penalty.

If an EITC claim was reduced or denied after tax year 1996 for any reason other than a mathematical or clerical error, taxpayers must file Form 8862, Information to Claim Earned Income Credit after Disallowance, with their next return to claim the credit.

Qualify for EITC? See what other tax credits are available.

Related items:
  • – Detailed EITC eligibility rules
  • EITC Central at – Helpful resources for IRS partners and anyone interested in spreading the word about this benefit.
  • Pub. 596 – Earned Income Credit (EIC)
  • Tax Professionals – Another place for valuable EITC resources and assistance.

The Earned Income Tax Credit: Often Missed

The Earned Income Tax Credit has helped workers with low and moderate incomes get a tax break for 40 years. Yet, one out of every five eligible workers fails to claim it. Here are some things you should know about this valuable credit:
  • Review Your Eligibility. If you worked and earned under $53,267, you may qualify for EITC. If your income or family situation has changed, you should review the EITC eligibility rules. You might qualify for EITC this year even if you didn’t in the past. If you qualify for EITC you must file a federal income tax return and claim the credit to get it. This is true even if you are not otherwise required to file a tax return. Don’t guess about your EITC eligibility. Use the EITC Assistant tool on The tool can help you find out if you qualify for the credit. It can also estimate the amount of your EITC.
  • Know the Rules. You need to understand the rules before you claim the EITC, to be sure you qualify. It’s important that you get this right. Here are some factors you should consider:
o If you are married and file a separate return you do not qualify for EITC.

o You must have a Social Security number that is valid for employment for yourself, your spouse, if married, and any qualifying child listed on your tax return.

o You must have earned income. Earned income includes earnings from working for someone else or working for yourself.

o You may be married or single, with or without children to qualify. If you don’t have children, you must also meet age, residency and dependency rules. If you have a child who lived with you for more than six months of 2015, the child must meet age, residency, relationship and the joint return rules to qualify.

o If you are a member of the U.S. Armed Forces serving in a combat zone, special rules apply.
  • Lower Your Tax or Get a Refund. If you qualify for EITC, you could pay less federal tax, no tax or even get a refund. EITC could be worth up to $6,242. The average credit was $2,447 last year.
  • Use Free Services. If you do your own taxes, the best way to file your return to claim EITC is to use IRS Free File. Free brand-name software will figure your taxes and EITC for you. Combining e-file with direct deposit is the fastest and safest way to get your refund. Free File is only available on You can also get free help preparing and e-filing your return to claim your EITC. The IRS Volunteer Income Tax Assistance, or VITA, program offers free help at thousands of sites around the country. You can also get help with the health care law tax provisions with Free File or VITA.
For more on EITC, see IRS Publication 596, Earned Income Credit. It’s available in English and Spanish on

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on

Additional IRS Resources:

Six Tips about Individual Shared Responsibility Payments

For any month during the year that you or any of your family members don’t have minimum essential coverage and don’t qualify for a coverage exemption, you are required to make an individual shared responsibility payment when you file your tax return.
Here are six things to know about this payment:

  • You are not required to make a payment if you had coverage or qualify for an exemption for each month of the year.
  •  If you did not have coverage and your income was below the tax filing threshold for your filing status, you qualify for a coverage exemption and you should not make a payment. 
  • If you are not a U.S. citizen or national, and are not lawfully present in the United States, you are exempt from the individual shared responsibility provision and do not need to make a payment. For this purpose, an immigrant with Deferred Action for Childhood Arrivals status is considered not lawfully present and therefore is exempt. You may qualify for this exemption even if you have a social security number. 
  • If you are responsible for the individual shared responsibility payment, you should pay it with your tax return or in response to a letter from the IRS requesting payment. You should not make the payment directly to any individual or return preparer. 
  • The amount due is reported on Form 1040 in the Other Taxes section, and in the corresponding sections of Form 1040A and 1040EZ. You only make a payment for the months you or your dependents did not have coverage or qualify for a coverage exemption.

In most cases, the shared responsibility payment reduces your refund. If you are not claiming a refund, the payment will increase the amount you owe on your tax return.

Remember, that filing electronically is the easiest way to file a complete and accurate tax return as the software does the math and guides you through the filing process. Electronic filing options include: free Volunteer Assistance, IRS Free File, commercial software, and professional assistance.