Low-income families and individuals who had earned income in 2011 could receive up to $5,751 from the Earned Income Tax Credit (EITC). "This credit is refundable, meaning that you could get money back even if you paid no tax or owe no income tax," Chan said.
The highest income at which you can receive the EITC is determined by the number of children and your filing status. For example, the income limit is $49,078 for a married couple with three or more children, $43,998 for a single person with three or more qualifying children, and $36,052 for a single filer with one child. Workers between the ages of 25 and 64 who have no children and whose income is no more than $13,660 could receive up to $464.
The largest credits are received by tax filers with three or more children whose income is in the $12,000 to $23,000 range. The amount of the credit gradually drops as income increases or decreases from that point.
The largest credit for a family with one child is $3,094 for single filers with incomes between $9,100 and $16,700, or up to $21,800 for married persons filing jointly.
Income from investments cannot be more than $3,150 to qualify for the earned income tax credit.
For more information, visit www.irs.gov/eitc or call 1-800-829-1040.
Chan said you don't even have to pay anyone to prepare your tax return to get the credits. To find a location where low-income workers can have their taxes prepared for free by trained volunteers, call 1-800-906-9887.
People aged 60 and older, as well as others with low to middle income, can also get their taxes prepared at AARP Tax-Aide sites. Locate a Tax Aide site by calling 1-888-227-7669.
"You may discover that you are also eligible for other tax credits," Chan said. "Tax filers with children and incomes up to $110,000 for married persons filing jointly and $75,000 for single or head of household may be eligible for the Child Tax Credit, worth up to $1000 per child," she said.
If you paid someone to care for your child, or another family member, you may be able to claim the Child and Dependent Care Credit. Use IRS Form 2441 to claim the credit.
If you, your spouse, or child are taking classes toward a degree, a certificate, or to improve your job skills, you may be able to claim the American Opportunity Education Credit or the Lifetime Learning Credit.
For more on financial topics, visit University of Illinois Extension's blog "Plan Well — Retire Well," at http://web.extension.illinois.edu/lm/eb141/.
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