EITC and Unemployment 2024

Forum|Forum|1 year ago
January 25, 2025
1 reply
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Hello-

My question is this:

The IRS EITC calculator says that my EITC should be almost $7,000 but TurboTax is telling me I'm only getting half of it.

My Earned Income was around 22,690 and my UI Benefits were 15K. I'm still eligible per IRS so what's the deal?

DianeW777

Yes, you are eligible based on your earnings. However unemployment compensation is not considered earned income and will not factor into the earned income tax credit (EITC) accept when comparing the adjusted gross income (AGI) with earnings in the calculation.

See IRS Publication 596, page 4, and page 8
- Examples of items that aren't earned income include interest and dividends, pensions and annuities, social security and railroad retirement benefits (including disability benefits), alimony and child support, welfare benefits, workers' compensation benefits, unemployment compensation (insurance), nontaxable foster care payments, and veterans' benefits, including VA rehabilitation payments. Don’t include any of these items in your earned income.
- What is earned income credit and qualifications?

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