I'm trying to figure out if my husband and I made too much to qualify for the EIC, and if we are in a new tax brackett...we have 2 kids.
2007-11-15 03:39:12 · 5 answers · asked by Leigh 2 in Business & Finance ➔ Taxes ➔ United States
our gross income will be around $48,000, up from $25,000 last year. Our kids are under 4yrs old...
2007-11-15 03:56:22 · update #1
bostonianinmo - Can you please email me an elaboration on what the "marginal rate, and tax liability " is...
What would I do with that %15 you mentioned to give myself a guestimate of our return next year?
Thanks!
2007-11-15 05:00:23 · update #2
Yeah, you can go online to www.irs.gov and take a look at the 1040 form for 2007. You will just input your projected income this year to calculate. This should give you a pretty good idea whether you will qualify for the EIC or not. If you have filled out a 1040 yourself before, you should be able to figure it out quickly. If not, give it a try. If you find that you are unable to figure it out, you can talk to an accountant and get an idea.
2007-11-15 03:50:13 · answer #1 · answered by fnipohc 2 · 0⤊ 0⤋
If you made over around $38,400, you are probably out of the EIC range - if you made less than that and otherwise qualify, then you should get it. You do know that EIC amount depends on income, so if you are very close to the limit, your EIC would be very small.
If your income qualifies you for EIC, then you'd be in a 10% bracket, although if your kids are under 17 so you can get the child tax credit for them, that would probably wipe out any tax you owe.
If you'll post again with what you expect your joint income to be for the year, someone can give you a better answer.
2007-11-15 03:53:32 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
With $48,000 in earned income, you're clearly out of EIC territory.
Your marginal rate will be 15% and your total tax liability will be in the region of $2,800 but the Child Tax Credit and Additional Child Tax Credit will probably wipe most of that out.
2007-11-15 04:15:12 · answer #3 · answered by Bostonian In MO 7 · 0⤊ 0⤋
"Marginal tax rate" is the rate you pay on (a small amount of) additional income. A 15% rate means that if you earn another $100 you will owe another $15 dollars in income tax, before accounting for any withholding, other payments, or credits.
"Total tax liability" is your total income tax, before accounting for any withholding, other payments, or credits. It is line 46 on the 2007 form 1040. Line 63 is your tax after including credits, but before including payments.
2007-11-15 08:59:11 · answer #4 · answered by CarVolunteer 6 · 0⤊ 0⤋
www.irs.gov - should have all of the information for you. You can use their calculators on there and get a fairly accurate answer to your question.
2007-11-15 03:46:56 · answer #5 · answered by Challah back Girl... 5 · 0⤊ 0⤋