He didn't read that you had to have a qualifying child in order to take this credit. What will happen when he files and he puts that he was getting that amount, but then he's going to have to put that he actually didn't have a qualifying child? Does anyone know? Will it just take away from any amount he was going to get back??
2007-01-20 12:03:38 · 10 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
Why did he do that??? The IRS will probably just take the money back, that should be all
2007-01-20 12:06:30 · answer #1 · answered by Kelly H 4 · 0⤊ 0⤋
In order to claim the advanced Earned Income Tax Credit, where it's paid in weekly installments instead of one lump sum, all four of the following MUST apply:
- 1. You (and your spouse, if filing a joint return) have a valid
social security number (SSN) issued by the Social Security
Administration. For more information on valid SSNs, see Pub.
596, Earned Income Credit (EIC).
- 2. You expect to have at least one qualifying child and to be
able to claim the credit using that child. If you do not expect to
have a qualifying child, you may still be eligible for the EIC, but
you cannot receive advance EIC payments.
- 3. You expect that your 2007 earned income and adjusted
gross income (AGI) will each be less than $33,241 ($35,241 if
you expect to file a joint return for 2007). Include your
spouse’s income if you plan to file a joint return. As used on
this form, earned income does not include amounts inmates in penal institutions are paid for their work, amounts received as
a pension or annuity from a nonqualified deferred
compensation plan or a nongovernmental section 457 plan, or
nontaxable earned income.
- 4. You expect to be able to claim the EIC for 2007.
The only way your friend could qualify was if he and his wife expected to have a child last year.
If he doesn't qualify for the EITC, he'll have to pay it back to the IRS.
Tell your friend the next time he signs something with these words on it that he better read every everything printed on the paper:
"Under penalties of perjury, I declare that the information I have furnished above is, to the best of my knowledge, true, correct, and complete.
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2007-01-20 13:25:20 · answer #2 · answered by WiseOwl 2 · 0⤊ 0⤋
Believe it or not, you can claim just about anything you want on your W-4, 10 kids, or whatever. When you file your 1040 return, you must be truthful. That can mean you end up paying taxes instead of getting a refund. I know people who do this and invest the extra money. That way they make money instead of letting the government sit on it.
Also, you do not always need to have a qualifying child to get the EIC. I got it some years ago because I made next to nothing that year. I was single and had no kids. I didn't realize I was qualified, but I had my return done at the IRS office by an IRS employee, so obviously, I was.
2007-01-20 12:16:35 · answer #3 · answered by Uther Aurelianus 6 · 0⤊ 0⤋
Your friend will have to pay that money back. Even tax payers that have qualifying children should not take the advance on the earned income. It is not a wise move . The government knows. It is on his/ her W2. Single folks get taxed at a higher rate than those with qualifying children.
2007-01-20 12:24:02 · answer #4 · answered by IVETTE C 1 · 0⤊ 0⤋
The advanced earned income credit will appear on his W-2.
He will enter it into his tax return and will have to pay that amount back as part of his tax return, since he will have no earned income credit to offset what he has received.
2007-01-20 12:47:38 · answer #5 · answered by ninasgramma 7 · 0⤊ 0⤋
It will have to be repaid, of course, but there might also be penalties such as not being eligible for the EIC for a certain number of years even if he otherwise would have been.
On his return, there's a place for advance EIC received - he'll put the number there that he received - it should be on his W-2. That will add to taxes owed, or subtract from his refund, on the tax return.
2007-01-20 13:21:55 · answer #6 · answered by Judy 7 · 0⤊ 0⤋
yes the amount that he was given will be taken from his return. I dont understand why he was given this credit in the first place. His employer should have an answer to this. I would ask them first.
2007-01-20 12:07:29 · answer #7 · answered by cheraerae 2 · 0⤊ 0⤋
The IRS can help him @ 1.829.1040. That is their Tax Help-Individual- tax line.
2007-01-20 12:08:10 · answer #8 · answered by Anonymous · 0⤊ 0⤋
It will be an unqualified deduction and it must be repaid
2007-01-20 12:06:35 · answer #9 · answered by Jim M 2 · 0⤊ 0⤋
he may get udited for and end having to pay all that back....
2007-01-20 12:06:48 · answer #10 · answered by Faith 4 · 0⤊ 0⤋