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| Image by didbygraham via Flickr |
I’ve received a lot of questions about this. Apparently as folks file their returns for the year, they are finding a difference in the amount of refund that they are due to receive this year versus last year. And as they look for answers, they often focus on the Earned Income Credit (EIC) and wonder if something changed.
The answer is – very little changed. Certainly nothing that would have a significant impact on your income tax refund. There was one significant change, in that beginning in 2011 there was no advance payment of the EIC – in years past it was an option available for the taxpayer to receive his or her EIC in advance payments throughout the year rather than waiting until the tax return has been filed. Beginning with 2011, you have to wait to receive the EIC payment.
Other than that, the credit tables changed slightly, but this would likely increase your EIC rather than decrease it.
Nothing else changed about the EIC in 2011. You need to look elsewhere for whatever is different about your return.
Nothing is changing for 2012 either. Beginning with 2013 (under current law) the additional EIC available for the third child will no longer be available, and we’ll revert back to the way the old rules worked. But let’s wait until next year to worry about that one.
Hope this helps.
Sterling Raskie, MSFS, CFP®, ChFC®
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And if you’ve come here to learn about queuing waterfowl, I apologize for the confusion. You may want to discuss your question with Lester, my loyal watchduck and self-proclaimed “advisor’s advisor”.