State Tax Officials Remind Residents To Check Earned Income Tax Credit Eligibility

The state Department of Taxation and Finance and the New York State Office of Temporary Disability Assistance are reminding state taxpayers to check their eligibility for the earned income tax credit.

The credit can reduce the amount of taxes owed or provide a substantial tax refund, potentially worth several thousand dollars for lower-income workers.

Earned Income Tax Credits are refundable federal, New York state and New York City credits for working taxpayers. For tax year 2017, the maximum total of federal, state, and New York City EITCs is $8,529 (for a family with three children).

“Taxpayers have, as the credit’s name implies, earned this benefit, so we urge all New Yorkers to check their eligibility and claim what they’re due,” said Nonie Manion, acting state taxation and finance director. “Earned income tax credits are a financial lifeline for many, providing money to pay rent, groceries, energy bills, and other daily expenses.”

In tax year 2015, more than 1.83 million New Yorkers received the federal Earned Income Tax Credit. When the federal, New York state and New York City benefits were combined, the benefit to working families and individuals was more than $5.4 billion with an average benefit of more than $2,950 per household.

Each year, thousands of New Yorkers qualify for the EITC for the first time as their filing status or personal financial situation changes. The IRS estimates that nearly 400,000 eligible New Yorkers fail to claim the credits.

In addition to the specific income requirements, taxpayers must meet other criteria such as:

¯ earn wages from employment or self-employment;

¯ have a valid Social Security number;

¯ have a qualifying child living with them for more than half the year, or, if they don’t have a qualifying child, be at least 25 years of age and under age 65; and

¯ have investment income of less than $3,450.

Taxpayers must also file a tax return, even if they don’t owe any tax or aren’t otherwise required to file. Those eligible who prepare their returns electronically will be automatically prompted to claim this credit and others. Those who were eligible in previous years but didn’t claim the credit may still be able to submit an amended income tax return for up to three years.

The Tax Department also reminded those ineligible for Earned Income Tax Credit benefits to look for other possible tax credits that they might be eligible to claim, such as the child and dependent care credit.

In 2006, New York State became the first state in the nation to enact a noncustodial parent Earned Income Tax Credit. The refundable credit is one of the many ways the state encourages low-income noncustodial parents to work and stay current with their child support payments.

In 2015, more than 6,700 taxpayers claimed the noncustodial parent EITC, totaling almost $3.4 million in taxpayer benefits.