TaxACT automatically calculates the earned income credit based on the information in your return. If you have a dependent that is a qualifying child, enter your dependent information (including name, SSN, relationship to you, year of birth, number of months lived with you, and student status if ages 19 through 23) during the Basic Information questions. TaxACT will then use the dependent information in the calculation of the earned income credit. To review your dependent entries, click on the Basic Info tab and then click on Dependents. You must also enter your income information before the credit can calculate.

To enter or review your earned income credit information in TaxACT:

1. From within your TaxACT return (Online or Desktop), click on the Federal Q&A tab
2. Click Other Credits to expand the section and then click Earned income credit
3. Review the qualifications for the EIC and select any statements that apply to you, then click Continue
4. On the screen titled Earned Income Credit - Qualifying Children, click Review to modify a child's qualifications, or click Add Child to enter information for another qualifying child. Click Continue when you are finished reviewing your qualifying child information.
5. Make any necessary adjustments to income on the screen titled Earned Income Credit - Calculation, then click Continue
6. Your total earned income credit amount will appear on the Earned Income Credit - Summary screen

Additional Information

The Tax Relief and Job Creation Act extends a temporary increase in the earned income tax credit (EITC) for taxpayers with three or more qualifying children. The maximum EITC for this category is now $6,143. The Act also extends an increase in the beginning point of the phaseout range for the credit for all married couples filing a joint return, regardless of the number of children. These changes apply to tax returns through tax year 2017.

The earned income tax credit is a refundable credit intended to help people who work but earn modest incomes. To qualify, earned income and adjusted gross income must each be less than:

• $46,997 ($52,427 married filing jointly) with three or more qualifying children
• $43,756 ($49,186 married filing jointly) with two qualifying children
• $38,511 ($43,941 married filing jointly) with on qualifying child
• $14,590 ($20,020 married filing jointly) with no qualifying children

The maximum credit for tax year 2014 is:

• $6,143 with three or more qualifying children
• $5,460 with two qualifying children
• $3,305 with one qualifying child
• $496 with no qualifying children

Related Links:

• Enter or Edit Combat Pay for Calculation of the Earned Income Credit
• Preview of 2014 EITC Income Limits, Maximum Credit Amounts and Tax Law Updates
• EITC Homepage