In 2019, what is the earned income credit allowed Don Andersen, a head of household taxpayer,...

In 2019, what is the earned income credit allowed Don Andersen, a head of household taxpayer, assuming he has adjusted gross income of $9,500 (consisting of interest income of $3,500 and earned income of $6,000? He maintains his household with his daughter.

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Expert Solution

Answer :

Earned income credit is a refundable tax credit available to taxpayers who have earned income.

For 2019 for a head of household earned income and adjusted gross income (AGI) must each be less than the following :

$50,162 with three or more qualifying children

$46,703 with two qualifying children

$41,094 with one qualifying child

$15,570 with no qualifying children

Investment income must be $3,600 or less for the year.

Maximum credit will be :

$6,557 with three or more qualifying children

$5,828 with two qualifying children

$3,526 with one qualifying child

$529 with no qualifying children

In above Question :

Adjusted gross income of Don Andersen = $9,500

Interest income = $3,500

Number of Children = 1

So, Don Andersen qualifies under above provisions.

Earned income = $6,000

Maximum Credit available = $3,526 with one qualifying child

So, Earned income credit allowed Don Andersen = $3,526

ekkarill92 answered 1 year ago

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