EARNED INCOME CREDIT LIFTS CHILDREN OUT OF POVERTY

ALABAMA A&M and AUBURN UNIVERSITIES

For more information,
contact Donna Reynolds,Extension Assistant Editor

EARNED INCOME CREDIT LIFTS CHILDREN OUT OF POVERTY

AUBURN, JAN. 28,2000---In recent years, the impact of the Earned Income Credit (EIC) on poverty among children has increased substantially. In fact, it now lifts more than 2 million children out of poverty.

Created in 1975, the EIC is a special tax benefit for low- to moderate-income earners. In some cases, it allows workers to receive money from the IRS without even having to pay any taxes.

The EIC now lifts more than two million children out of poverty annually. Its effectiveness varies by region, with its greatest impact in the South. The EIC is especially effective for Hispanic children, lifting 800,000 Hispanic children out of poverty in 1996.

In Alabama, preliminary claims for first eight months of 1999 for the tax year 1998 showed 435,626 working families and individuals were getting EIC which was worth more than $773,900 million.

Single and married people who worked either full or part-time during 1999 may qualify for the EIC if their income is in the range. You qualify if you meet one of the following requirements:

You have one child in your home and had a family income of less than $26,928. You may receive an EIC up to $2,312.
You have more than one child in your home and had a family income of less than $30,580. You may receive an EIC up to $3,816.
You don't have any children in your home but you were between ages 25 and 64 on Dec. 31 and had an income below $10,200. Your EIC may be up to $347.

To qualify, children must be under 19 or under age 24 if they're full-time students. A Social Security number is required for any child you claim.

For additional information on the EIC program, contact your county Extension office.

SOURCE: ROBERT WHITE, Extension Agent on Special Assignment, Alabama Cooperative Extension System, (334) 844-2235