Form It-40 - Indiana Full-Year Resident Individual Income Tax Booklet - 2012 Page 31
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643.
If you have:
Yes. Go to Step 7.
No. STOP. You cannot take the credit.
•
2 or more qualifying children, is Box A less than $41,950?
•
1 qualifying child, is Box A less than $36,900?
•
No qualifying children, is Box A less than $13,900?
Step 7 How to Figure the Credit
Go to Worksheet A on page 33.
Yes. Go to Step 6.
No. STOP. You cannot take the credit.
Definitions and Special Rules
(listed in alphabetical order)
Step 6 Earned Income
Adopted child. An adopted child is always treated as your own child.
1.
Did you file federal Schedule SE because you are a member of the
The term “adopted child” includes a child who was lawfully placed
clergy or you had church employee income of $108.28 or more?
with you for legal adoption, even if the adoption is not final.
Yes. See Clergy or Church employees, whichever applies, on this page.
Church employees. A church employee means an employee (other
No. Continue
than a minister or member of a religious order) of a church or quali-
fied church-controlled organization that is exempt from employer So-
2.
Figure earned income:
cial Security and Medicare taxes. Determine how much of the amount
A. Enter amount from federal Form 1040
on federal Form 1040, line 7, was also reported on federal Schedule SE,
or 1040A, line 7, or Form 1040EZ, line 1
_________
Section B, line 5a. Subtract that amount from the amount on federal
Form 1040, line 7, and enter the result in the first space of Step 6, line
Subtract, if included on line A above, any:
2. Be sure to answer “Yes” to question 1 in Step 6.
•
Taxable scholarship or fellowship grant not
reported on a Form W-2.
Claim for refund. A claim for refund is a federal return filed only to
•
Amount received for work performed while
get a refund of withheld income tax or estimated tax paid. A federal
an inmate in a penal institution.
return is not a claim for refund if the EIC or any other similar refund-
•
Amount received as a pension or annuity from
able credit is claimed on it.
a nonqualified deferred compensation plan or a
nongovernmental section 457 plan. This
Clergy. The following instructions apply to ministers, members of
amount may be shown in box 11 of form W-2.
religious orders who have not taken a vow of poverty, and Christian
If you received such an amount but box 11 is
Science practitioners. If you are filing federal Schedule SE and the
blank, contact your employer for the amount
amount on line 2 of that schedule includes an amount that was also
received as a pension or annuity.
-
_________
reported on federal Form 1040, line 7;
•
Determine how much of the amount on federal Form 1040, line
Add all of your nontaxable combat pay if you elect
7, was also reported on federal Schedule SE, Section A, line 2, or
to include it in earned income.*
+ _________
Section B, line 2.
•
Subtract that amount from the amount on federal Form 1040, line
*Caution. Electing to include nontaxable combat
7. Enter the result in the first space of Step 6, line 2.
pay may increase or decrease your EIC. Figure the
•
Be sure to answer “yes” to question 1 in Step 6.
credit with and without your nontaxable combat pay
before making the election.
Combat pay, nontaxable. If you were a member of the U.S. Armed
Forces who served in a combat zone, certain pay is excluded from your
Earned Income =
Box B
income.
•
If you included your combat pay when figuring your federal EIC,
3.
Were you self-employed at any time in 2012, or did you file fed-
then enter the same amount in Step 6, line 2.
eral Schedule SE because you were a member of the clergy or you
•
If you did not include it when figuring your federal EIC, then do
had church employee income, or did you file federal Schedule C
not enter any amount in Step 6, line 2.
or C-EZ as a statutory employee?
Exception to “time lived with you” condition. A child is considered
Yes. Skip question 4 and Step 7; go to Worksheet B on page 34.
to have lived with you for all of 2012 if the child was born or died in
No. Continue.
2012 and your home was this child’s home for the entire time he or she
was alive in 2012. Temporary absences, such as for school, vacation,
If you have:
medical care, or detention in a juvenile facility, count as time lived at
•
2 or more qualifying children, is your total earned income (Box
home. If your child is presumed to have been kidnapped by someone
B) less than $41,950?
who is not a family member, see Indiana’s Pub. EIC to find out if that
•
1 qualifying child, is your total earned income (Box B) less than
child is a qualifying child for the EIC. If you were in the military sta-
$36,900?
tioned outside the United States, see Members of the military on
•
No qualifying children, is your total earned income (Box B) less
page 32.
than $13,900?
Page 31
IT-40 Booklet 2012
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