Question

The TurboTax software didn't automatically check for the "lookback" option when attempting to claim the EIC. Will it be applied (I did file with TT online last year).

Forum|Forum|5 years ago
February 12, 2021
1 reply
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TT software didn't give me any of the EIC credit this year. But last year I received some of the EIC. So it should have checked that. Now it hasn't been sent to IRS but it doesn't give me any credit for EIC, due to a increase of income from unemployment benefits this year. Will TurboTax auto fix this? I can't access or amend return currently. But this seems to be a lapse in software that doesn't give greatest rebate available.

TurboTax Free Edition Online

C

Cynthiad66

Turbotax does not make the decision to file using the Lookback rule for you. You must make that decision within the software. If you have already transmitted your tax return to the IRS, then you will need to Amend the 2020 to do take advantage of the LookBack rule for the Earned Income Credit.

If you're referring to the IRS Taxpayer Certainty and Disaster Tax Relief Act of 2020 EIC special look back provision, see the steps below.

Type EIC in the search and select the Jump to.
Continue with the onscreen interview until you get to the Do you want to use last year's earned income? screen.
Continue with the onscreen interview until complete.

Per IRS: If your earned income was higher in 2019 than in 2020, you can use the 2019 amount to figure your EITC for 2020. This temporary relief is provided through the Taxpayer Certainty and Disaster Tax Relief Act of 2020.

Note: If you earned income was higher in 2020 versus 2019, you won't be able to use the EIC special look back.

Special Lookback for Earned Income Tax Credit and the Child Tax Credit

This is a very important provision which has the potential to help workers who experienced lower income in 2020, or received unemployment income in lieu of their regular wages, get bigger tax credits and larger refunds in the coming year.

The special lookback rule will allow lower income individuals to use their earned income from 2019 to determine their Earned Income Tax Credit and the refundable portion of the Child Tax Credit in 2020, since their lower 2020 income could reduce the amount they are eligible for.

The Earned Income Tax Credit is the country’s largest program for working people with low to moderate income. More than 25 million eligible tax filers received federal Earned Income Tax Credit last tax season and the average Earned Income Tax Credit was $2,476 per filer.

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T

theelite1x87

Ok. I was wondering this. I did not know what the look-back option was when I filed. Unfortunately didn't know until after theyve been accepted. However, you mention if your earned income in higher in 2020 then you cannot use lookback? How is earned income defined, are you saying Adjusted Gross? My adjusted gross income is about 2500 dollars more in 2020 versus 2019 so if based on that, I could not use lookback. But my Box 1 "wages, salaries etc" on form 1040 is actually about 500 bucks less than tax year 2019. Reason is about 2100 bucks of my income from 2020 was unemployment income so my income from work is slightly less than 2019 but my adjusted gross is actually more.

Just wanted to clarify if I CAN use the lookback so I can decide if I want to go through the ordeal of amending the return that was JUST accepted...

C

Cynthiad66

Taxable earned income includes:

Wages, salaries, tips, and other taxable employee compensation; Union strike benefits; Disability retirement benefits received prior to minimum retirement age; (See definition of statutory employee on our Helpful Definitions and Acronyms for the EITC page)

This new lookback rule, which was part of the Taxpayer Certainty and Disaster Tax Relief Act of 2020, may allow certain taxpayers to claim these valuable credits based on their 2019 earned income when it is higher than their 2020 earned income.

TurboTax allows you to amend your return free. So, you should use the system to play with the numbers to see what works best. Since you have used Turbotax all of the information is there already and all you have to do is:

Sign in to TurboTax.
Scroll down to Your tax return & documents (you may need to select Show), select 2020 and then Amend (change) return.
- If you only see the option to amend 2019 or earlier, it's because you can't amend an unfiled 2020 return. Instead, just select Pick up where you left off, make your changes, and disregard the rest of these instructions.
Select Amend using TurboTax Online.
Carefully follow the instructions. Don't worry if your refund changes to $0. This is normal on amended returns.
You can e-file your 2020 amended federal tax return, but most states require amendments to be printed and filed by mail.
If e-filing, you’ll review, sign and transmit your federal return. If not, we'll give you instructions to print and mail your amended return.

Three weeks after mailing your amended return, you can start tracking it at the IRS Where's My Amended Return? tracking tool. Please allow at least 16 weeks for the IRS to process your amended return.

Processing times for amended state returns vary from state to state. If it's been more than 12 weeks since you mailed your amended state return, and you haven't heard anything, we suggest you contact your state tax agency.

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