According to the IRS, an estimated 20 to 25% of qualified workers fail to claim the EITC each year. We’ll be listing 5 of the top reasons that you might miss out on the EITC starting with number 1 this week.
Mistake #1: You didn’t file taxes (because you didn’t need to)
The EITC can only be claimed by filing a tax return but some workers miss out because they don’t earn enough to be required to file taxes.
Let’s be clear, there’s a difference between when you need to file taxes and when you should file taxes.
As a general rule, anyone that had taxes taken out of their wages or could qualify for the EITC and other refundable credits should look into filing their taxes.
Take Mary, a single mother of two, who made $12,000 – just under the amount where she’s required to file taxes ($12,200 for Head of Household). Even though she isn’t required to file, we estimated that she could get $4,810 from the EITC!
Just to drive this point a bit further, let’s take a look at Michael, who is single, has no kids, and made $1,500 last year. Even though he didn’t earn much and doesn’t need to file, he could claim an estimated $117 from the EITC when he does.
Finding affordable tax preparation
Getting your taxes done shouldn’t be costly. That’s why there are volunteers across Minnesota who help for free. Learn more about free tax prep in Minnesota.