Indiana Earned Income Credit - 2013 (Page 6 of 17) in pdf

Publication EIC: Indiana Earned Income Credit

Example 1. Your 12 year-old brother lived with you the entire year. If you are eligible to claim him as a qualifying

child for federal EIC purposes, then you are eligible to claim him for Indiana EIC purposes.

Example 2. The facts are the same as in Example 1, but your brother lived with you for seven months during the

year. Even though you may be eligible to claim him as a qualifying child for federal EIC purposes, you are not

eligible to claim him for Indiana EIC purposes as he did not live with you the entire year.

Difference 2. Qualifying child of more than one person.

Sometimes a child meets the tests to be a qualifying child of more than one person. However, only one person

can claim the EIC using that child. The paragraphs that follow will help you decide who can claim Indiana’s EIC

when more than one person has the same qualifying child.

Tiebreaker Rules. The following tiebreaker rules do not apply if the other person is your spouse and you file a

joint return.

Important. For Indiana EIC purposes, your qualifying child cannot be the qualifying child of another person

who has a higher modified AGI.

Which person can claim the EIC. If you and someone else have the same qualifying child, the person with the

higher modified adjusted gross income (AGI) is the only one who may be able to claim Indiana’s EIC using that

child. The person with the lower modified AGI cannot use that child to claim the EIC. This is true even if the

person with the higher modified AGI does not claim the EIC or meet all of the rules to claim the EIC. If the

other person is your spouse and you file a joint return, this rule does not apply. If three or more persons have the

same qualifying child, the person with the highest modified AGI is the only one who may be able to claim the

EIC using that child.

Note. For most people modified AGI is the same as federal AGI (line 37, Form 1040; line 21, Form 1040A; or line

4, Form 1040EZ). Modified AGI is explained in detail in Chapter 3. If your qualifying child meets the tests to be

a qualifying child of both you and any other person and you have the higher modified AGI, you meet this rule. If

you do not have the higher modified AGI, you cannot claim the qualifying child for Indiana EIC purposes.

Examples. The following examples may help you in determining whether you can claim Indiana’s EIC when you

and someone else have the same qualifying child.

Example 1. You and your child lived with your parent.

You and your son lived with your mother all year. You are 25 years old. Your only income was $9,300 from a

part-time job. Your mother’s only income was $15,000 from her job. Initially, your son is a qualifying child of

both you and your mother because he meets the age, joint federal return and residency tests for both you and

your mother. However, because you both have the same qualifying child, only one of you can claim the child for

Indiana EIC purposes. Because your mother’s modified AGI ($15,000) is more than your modified AGI ($9,300),

only your mother may be able to claim your son as a qualifying child for the Indiana EIC.

Example 2. The facts are the same as in Example 1, but your mother had investment income of $3,900. Your

mother cannot claim the EIC because her investment income is more than $3,300. Even though your mother

cannot claim the EIC, you cannot claim your son as a qualifying child for Indiana EIC purposes because your

mother’s modified AGI is more than yours.

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