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what is earned income credit

The Earned Income Credit (EIC) is a tax credit available to low- to moderate-income taxpayers who work and have earned income from wages, salaries, or self-employment. The EIC is designed to help working individuals and families who have low to moderate incomes and is intended to provide a financial boost to help them make ends meet.

To be eligible for the EIC, you must meet certain income and filing requirements. The amount of the credit is based on your earned income, the number of qualifying children you have, and your filing status. The EIC can be a significant benefit for eligible taxpayers, as it can reduce the amount of tax you owe or result in a tax refund.

To claim the EIC, you will need to file a tax return and complete Form 1040 or Form 1040-SR, as well as Schedule EIC. You will also need to provide proof of your earned income, such as pay stubs or a self-employment income statement.

If you think you may be eligible for the EIC, it’s a good idea to speak with a tax professional or use tax preparation software to determine your eligibility and calculate the amount of the credit you may be able to claim.