Grandparent raising grandchildren? You could get a tax break.
There are many grandparents who are the primary caregivers of their grandchildren. Often, such grandparents are unaware that their grandchild could qualify them for tax benefits through the Earned Income Tax Credit (EITC).
The EITC was created to serve people on the lower end of the income spectrum. If you qualify, the EITC can lower the amount you owe in taxes or even get you a refund. However, when it comes to claiming this tax credit, it’s important not to guess about whether you qualify. Follow the below guidelines to know for sure:
The EITC eligibility criteria for grandparents are the same as for parents. To qualify, you must:
- Be employed in some capacity—either through a job or self employment. Note that there is no age limit on this requirement. You can be eligible even if you are over 65 years old.
- Have a descendent living with you who is 18 years of age or younger and is your dependent.
- File a tax return. Note that if you are not otherwise required to file or don’t owe any taxes, you must still file a tax return in order to receive the EITC.
- Have a valid Social Security Number.
In addition, your income must be below a certain amount, depending on the number of qualifying children you claim:
- Three or more children: $48,340
- Two children: $45,007
- One child: $39,617
The above amounts increase by about $5,000 if you’re married and filing jointly with your spouse.
Keeping yourself informed about the government benefits available to you can save you money come tax season.
