Iowans looking at getting a start on their income taxes should remember to check the Earned Income Tax Credit. Internal Revenue Service spokesman Christopher Miller says a lot of people will be able to take that credit. The Earned Income Tax Credit is a tax break primarily for people who work but don’t earn high incomes. Miller says taxpayers who qualify for the credit could pay less tax, pay no tax at all — or even receive a refund.
To qualify, you have to meet certain rules and then file a tax return. So even if you don’t owe any tax or didn’t make enough to be required to file a return, you should still check out whether you can qualify for this credit — and if you do, then file, to claim it. Last year more than 165-thousand Iowa families received more than 270-Million dollars through the Earned Income Tax Credit.
The amount of the credit varies, but it’s determined by your income and the size of your families. Miller notes the amount of income allowed in the 2005 IRS income-tax worksheet is higher than it was the year before. Different rules apply but he says the credit can be as high as 4400-dollars for a married couple with a couple of kids.