Financial Planning for Generation X & Y Women
 
Notice: Because of a database server upgrade, this site may be partially non-functional from August 21st to August 22nd. No data will be lost. We apologize for any inconvenience.
Under slight reconstruction until 5PM CST today... Please excuse the dust!
Resource Center
Expert Q&A Archive Teleconference Call Archive Online Resources Federal Reserve Board Resources FPA Perspectives

Expert Q&A Archive

03/16/2010
Do self-employed business owners qualify for the EITC?
I work with a lot of Hispanic business owners in Idaho that are self-employed, but yet after their profit loss Schedule C [Form 1040, Schedule C, Profit or Loss from Business] they are very much low- income. Do they qualify for the Earned Income Tax Credit?
Delores Lenzy - Jones, CPA, CIA:
expert info »
Earned income credit is calculated separately from Schedule C. Your Adjusted Gross Income is used in arriving at your earned income credit. [The amount] depends on your overall income.
Joan Koonce, Ph.D:
expert info »
In order to qualify for the EITC, a person has to have earned income. According to the IRS "Earned income includes all the taxable income and wages you get from working. There are two ways to get earned income: You work for someone who pays you or you work in a business you own." Therefore, net self-employment income is earned income for EITC purposes.
 

Family Development & Resource Management
2251 TAMU | College Station, TX 77843-2251 | Map
Phone: (979) 845-3850 | Fax: (979) 845-6496 | E-mail:  fdrm@tamu.edu

Web Site Maintenance: Family & Consumer Sciences

All rights reserved