Form W-5 - Earned Income Credit Advance Payment Certificate

Form W-5 (1998)

Page

Questions To See if You May Be Able To Claim the EIC for 1998

Caution: You cannot claim the EIC if you plan to file either Form 2555 or Form 2555-EZ (relating to foreign earned income) for

1998. You also cannot claim the EIC if you are a nonresident alien for any part of 1998 unless you are marr ied to a U.S. citizen

or resident and elect to be taxed as a resident alien for all of 1998.

Do you have a qualifying child? Read Who Is a Qualifying Child? on page 1 before you answer this question. If the child is

married, be sure you also read Married child on page 1.

No. Stop. You may be able to claim the EIC but you cannot get advance EIC payments.

Yes. Go to question 2.

Caution: If the child is a qualifying child for both you and another person, the child is your qualifying child only if you expect

your 1998 modified AGI to be higher than the other person’s modified AGI. If the other person is your spouse and you expect

to file a joint retur n for 1998, this rule does not apply.

Do you expect your 1998 filing status to be Married filing a separate return?

Yes. Stop. You cannot claim the EIC.

No. Go to question 3.

If you expect to file a joint return for 1998, include your spouse’s income when answering questions 3 and 4.

Do you expect that your 1998 earned income and modified AGI (see page 1) will each be less than $26,473 (less than $30,095

if you have more than one qualifying child)?

No. Stop. You cannot claim the EIC.

Yes. Go to question 4. But remember, you cannot get advance EIC payments if you think your 1998 earned income or

modified AGI will be $26,473 or more.

Do you expect that your 1998 investment income will be more than $2,300? For most people, investment income is the total

of their taxable interest and dividends and tax-exempt interest. However, if you plan to file a 1998 Form 1040, see the 1997

Form 1040 instructions to figure your investment income.

Yes. Stop. You cannot claim the EIC.

No. Go to question 5.

Do you expect that you (or your spouse if filing a joint return) will be a qualifying child of another person for 1998?

No. You may be able to claim the EIC.

Yes. You cannot claim the EIC.

2. You have a pre-1985 divorce decree or

Note: If you get the EIC with your pay and

You are not required to provide the

separation agreement that allows the

find you are not eligible, you must pay it back

information requested on a form that is

noncustodial parent to claim the child and he

when you file your 1998 Federal income tax

subject to the Paperwork Reduction Act

unless the form displays a valid OMB control

or she gives at least $600 for the child’s

return.

support in 1998.

number. Books or records relating to a form

Additional Information

or its instructions must be retained as long as

Qualifying child of more than one person. If

their contents may become material in the

the child is a qualifying child of more than

How To Claim the EIC

administration of any Internal Revenue law.

one person, only the person with the highest

Generally, tax returns and return information

modified AGI for 1998 may treat that child as

If you are eligible, claim the EIC on your 1998

are confidential, as required by Code section

a qualifying child. If the other person is your

tax return. See your 1998 instruction booklet.

6103.

spouse and you plan to file a joint return for

Additional Credit

1998, this rule does not apply.

The time needed to complete this form will

vary depending on individual circumstances.

Reminder. Your qualifying child must have a

You may be able to claim a larger credit

The estimated average time is:

social security number.

when you file your 1998 tax return because

Recordkeeping, 7 min.; Learning about the

your employer cannot give you more than

What if My Situation Changes?

law or the form,

$1,363 of the EIC throughout the year with

9 min.; and Preparing the form,

your pay. You may also be able to claim a

If your situation changes after you give Form

27 min.

larger credit if you have more than one

W-5 to your employer, you will probably need

If you have comments concerning the

qualifying child. But you must file your 1998

to file a new Form W-5. For example, you

accuracy of these time estimates or

tax return to claim any additional credit.

should file a new Form W-5 if any of the

suggestions for making this form simpler, we

following applies for 1998.

would be happy to hear from you. You can

You no longer have a qualifying child.

Privacy Act and Paperwork Reduction Act

write to the Tax Forms Committee, Western

Check “No” on line 2 of your new

Notice. We ask for the information on this

Area Distribution Center, Rancho Cordova,

Form W-5.

form to carry out the Internal Revenue laws of

CA 95743-0001. DO NOT send the form to

You no longer expect to be able to claim

the United States. Internal Revenue Code

this address. Instead, give it to your

the EIC for 1998. Check “No” on line 1 of

sections 3507 and 6109 and their regulations

employer.

your new Form W-5.

require you to provide the information

requested on Form W-5 and give the form to

You no longer want advance payments.

your employer if you want advance payment

Check “No” on line 1 of your new

of the EIC. As provided by law, we may give

Form W-5.

the information to the Department of Justice

Your spouse files Form W-5 with his or her

and other Federal agencies. In addition, we

employer. Check “Yes” on line 4 of your new

may give it to cities, states, and the District of

Form W-5.

Columbia so they may carry out their tax

laws.

Form W-5 - Earned Income Credit Advance Payment Certificate - 1998 Page 2

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