EIC and federal income tax?

Question

What is Earned Income Credit in regard to federal income tax? Whom does it benefit, single parents, low wage earners, large families,etc?

Answer 1

Earned Income Credit is treated as a payment of taxes. If the taxpayer has less tax owed than the credit, the taxpayer gets paid the difference.

The EIC benefits two groups of taxpayers who have income from wages or self-employment (figures rounded down to the nearest thousand):

1. Those with no qualifying. If not married, the taxpayer must have earned income less than $12K a year. If married, the taxpayer must have earned income less than $14K.

2. Those with a qualifying child (or children). If not married, the earned income must be less than $34 ($36). If married, the earned income must be less than $36 ($38).

The EIC benefits both single and married parents. Large families do not get larger EIC, it is capped at two children.

There are many more details and qualifications for the EIC. The IRS publication is listed in the sources.

Answer 2

It is a refundable credit available to low income wage earners. If you are single and your income is very very low, you can get a small credit but the biggest credit goes to lower income single parents and lower income families with children. Theoretically, the credit was supposed to offset the social security and medicare taxes that the working poor pay but it has been expand to the point where, in many instances, it is much higher than the social security and medicare taxes paid by the wage earner. Some people have argued that it is just welfare built in to the tax code but, many of the working poor, the EIC accounts for the vast majority of their refund.

Answer 3

It benefits taxpayers with no children, with incomes up to about $14,000.
It benefits taxpayers with 2 or more children with incomes up to about $38,000.

Answer 4

people who oppose abolishing the federal income tax fall into a number of communities: a million. people who're philosophically oriented to making a socialist state. a number of those human beings are utopian dreamers who think of that we'd desire to elitists to make alternatives for us. Others opt to apply our very own money to impose their very own will on us. those human beings can fall into communities which we call socialists, communists and fascists. 2. There are people who count on the taxpayers for their financial reward. i'm no longer pertaining to those who've contributed to Social protection or veterans. i'm speaking of persons who's occupations or products count on government largess. 3. ultimately, there are silly people who believe that government could no longer exist and not utilising a private income tax. they do no longer seem to understand that we functioned ok earlier 1913, in certainty, human beings have been coming here interior the thousands and thousands earlier we had a private income tax (or any of the social classes). via abolishing the non-public income tax, no longer basically might we shop the money that we at the instant pay, shall we shop thousands and thousands if no longer billions of greenbacks via no longer having to pay the rate of holding the archives mandatory to rfile our returns. greater importantly, there could be no audits. no person might contemplate whether their "papers have been so as" each and every time they filed their income tax. no person might we prosecuted for income tax evasion, or failing to record, or perhaps erroneously itemizing what's, and is no longer deductible. And greater importantly, our funds could be our corporation, and no person else's. we does not be informing others of what we made, what we spent, and what we spent it on. you're appropriate. If we stopped waging conflict around the globe, and constrained the activities of our federal government to what the form authorizes, shall we do away with the non-public income tax.