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5 Tax Tips for the Unemployed

        Money | Taxes

2
See If You Qualify For the EITC
Make sure you know whether you qualify for the Earned Income Tax Credit before you finish your return.
Make sure you know whether you qualify for the Earned Income Tax Credit before you finish your return.

The Earned Income Tax Credit (EITC) is a tax break designed for working Americans with low incomes. The amount of the EITC depends on how much money you earn and the size of your family. To receive the largest credit, you can only earn around $15,000, and the EITC phases out completely if your adjusted gross income is $50,000 or over [source: IRS].

But here's the tricky part: You have to have income to qualify for the EITC, and unemployment benefits don't count as income when calculating the credit [source: Bell]. So if you were unemployed for the entire tax year, you might not have enough earned income to qualify for the EITC. But if you were employed for part of the year, or if your spouse contributed income, then you might still qualify for the EITC, which has a maximum payout of $5,751 for a family with three or more children [source: IRS].


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