What is the Earned Income Tax Credit, and How Can It Help You?

What is the Earned Income Tax Credit, and How Can It Help You?

What is the Earned Income Tax Credit, and How Can It Help You?

 

The Earned Income Tax Credit (EIC) is a tax credit that helps you keep more of what you earned.  The credit was initially passed in 1975 to offset the burden of social security taxes and provide incentive for working.  How is it calculated, and who qualifies?

To qualify for the EIC, you must meet a list of requirements.  Additionally, you must file a tax return.  So, if you make under the amount which requires a tax return to be filed, you will not get this money back unless you file a return.

Requirements include: (1) you must have earned income from employment, (2) if you do not have a qualifying child, you must meet additional rules.

If you qualify, your income must then be under a certain amount in order to use the credit.  For instance, if you have no children, you must have made under $13,980 last year in order to obtain the credit.  If you have children, that number could reach up to $45,060.

If you have the right income and meet these other requirements, then you can qualify for an EIC of somewhere between $475 and $5,891.

It is important to see if you qualify for the EIC, because many people overlook it and do not ever take advantage of a large return.  The most valuable thing about the EIC is that it is a credit, not a deduction.  While a deduction removes a certain amount of income from taxable income, a credit actually deducts a certain amount from your taxes.
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Property Exemptions in Bankruptcy

Property Exemptions in Bankruptcy

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Student Loan Debt and Bankruptcy

Student Loan Debt and Bankruptcy

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Filing for bankruptcy is complicated and stressful. You may be confused about what you are asked, or the state of your finances. This may lead you to be inaccurate or not thorough. And rumors and misconceptions about bankruptcy lead people to hide assets and not be upfront with their attorneys. All of this can lead to huge problems down the road. Below are the five biggest mistakes bankruptcy filers make when they file for Chapter 7 or Chapter 13 bankruptcy.Continue Reading

IRAs and Bankruptcy

IRAs and Bankruptcy

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Can the Trustee Really Take My Wedding Rings?!

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Bankruptcy Dismissal, Conversion, and the Means Test

Bankruptcy Dismissal, Conversion, and the Means Test

In this next post we will be discussing the issue surrounding dismissal or conversion of bankruptcy and the role and mechanism of the means test and presumption of abuseContinue Reading

Is Your Chapter 13 Bankruptcy Plan Feasible?

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Before the court confirms your chapter 13 plan, you will have to pass what is commonly referred to in bankruptcy law as the “feasibility” test. This isn’t really a test, but the court will look at whether or not the information we provide in the bankruptcy forms and schedules show enough income so that you can make the proposed payments. Whether it is the monthly payments you are proposing or a lump sum payment to be paid at the end of the plan, we should be able to show that the plan can be reasonably completed with the resources we report in the schedules. Continue Reading

What Happens to Utility Bills in Bankruptcy?

What Happens to Utility Bills in Bankruptcy?

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Chapter 13 Bankruptcy

Chapter 13 Bankruptcy

In previous blogs, I have written introductory information about the basic process in chapter 13 bankruptcy. In this next series of articles, I will discuss some of the issues surrounding chapter 13. In order to file chapter 13, you must be an individual with regular income. There are limits to the amount of debt you can have and still be eligible to file chapter 13. As of April 1, 2013 the limits are now $1,149,525.00 for secured debt and $383,175.00 for unsecured debt. These numbers are adjusted every three years. If you are close to these numbers, be sure and contact our office to get the current applicable limitations.Continue Reading