Publication 554 - Older Americans' Tax Guide - 2004 Page 26
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312. You must have earned income during the year.
United States for the purposes of the earned income
credit.
3. Your earned income and adjusted gross income
(AGI) each must be less than:
Age test. To meet the age test, your child must be:
a. $30,338 ($31,338 for married filing jointly) if you
•
Under age 19 at the end of the year,
have one qualifying child, or
•
A full-time student under age 24 at the end of the
b. $34,458 ($35,458 for married filing jointly) if you
year, or
have more than one qualifying child.
•
Permanently and totally disabled at any time during
4. Your investment income cannot be more than
the tax year, regardless of age.
$2,650.
5. Your filing status can be any filing status except
Persons Who Work and
married filing separately.
Do Not Have a Qualifying Child
6. You cannot be a qualifying child of another person. If
Generally, if you are a nonresident alien for any part of the
you file a joint return, neither you nor your spouse
year, you cannot claim the earned income credit. In order
can be a qualifying child of another person.
to take the earned income credit under this section, you
7. Your qualifying child cannot be used by more than
must meet all the following rules.
one person to claim the credit. If you and someone
•
else have the same qualifying child, you and the
You must have earned income during the year.
other person(s) can decide who will claim the credit
•
Your earned income and adjusted gross income
using that child. If you and the other person(s) can-
(AGI) each must be less than $11,490 ($12,490 if
not agree, see Publication 596.
married filing jointly).
8. You are not filing Form 2555, Foreign Earned In-
•
Your investment income must be $2,650 or less.
come or Form 2555-EZ, Foreign Earned Income Ex-
•
clusion.
Your filing status can be any filing status except
married filing separately.
•
Who is a qualifying child? You have a qualifying child if
You cannot be a qualifying child of another person. If
your child meets three tests. The tests are:
you file a joint return, neither you nor your spouse
can be a qualifying child of another person.
•
Relationship,
•
You (or your spouse if filing a joint return) must be at
•
Residency, and
least age 25 but under age 65 at the end of the year.
•
Age.
•
You cannot be eligible to be claimed as a dependent
on anyone else’s return. If you file a joint return,
Relationship test. To meet the relationship test for a
neither you nor your spouse can be eligible to be
qualifying child, the child must be your:
claimed as a dependent on anyone else’s return.
•
Son, daughter, stepson, stepdaughter, or adopted
•
Your main home (and your spouse’s if filing a joint
child (or a descendant of your son, daughter, step-
return) must be in the United States for more than
son, stepdaughter, or adopted child —for example,
half the year. U.S. military personnel stationed
your grandchild),
outside the United States on extended active duty
•
Brother, sister, stepbrother, or stepsister (or a de-
are considered to live in the United States for the
scendant of your brother, sister, stepbrother, or step-
purposes of the earned income credit.
sister) whom you cared for as you would your own
•
You are not filing Form 2555 or Form 2555-EZ.
child, or
•
Eligible foster child.
Advance Earned Income
See Publication 596 for an explanation of who is an eligible
foster child.
Credit Payments
Residency test. To meet the residency test, there are
If you have a qualifying child and expect to qualify for the
two rules.
earned income credit in 2005, you can choose to receive
•
You must have a child who lived with you for more
advance payments of part of the credit in your regular
than half the year.
paycheck.
•
You can request advance payments of the credit for
The home must be in the United States (one of the
2005 by completing a 2005 Form W-5. See Publication 596
50 states or the District of Columbia). U.S. military
or the Form W-5 instructions for more information on the
personnel stationed outside the United States on
extended active duty are considered to live in the
advance earned income credit.
Page 26
Chapter 5 Credits
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