2019 Earned Income Credit

2019 EITC Income Limits, Maximum Credit Amounts and Tax Law Updates

Earned Income and AGI Limits

The tax year 2019 Earned income and adjusted gross income (AGI) must each be less than:

If filing… Qualifying Children Claimed
Zero One Two Three or more
Single, Head of Household or Widowed $15,570 $41,094 $46,703 $50,162
Married Filing Jointly $21,370 $46,884 $52,493 $55,952

Investment Income Limit

Investment income must be $3,600 or less for the year.

Maximum Credit Amounts

The maximum amount of credit for Tax Year 2019 is:

  • $6,557 with three or more qualifying children
  • $5,828 with two qualifying children
  • $3,526 with one qualifying child
  • $529 with no qualifying children

For more information on whether a child qualifies you for EITC, see:

  • Qualifying Child Rules, or
  • Publication 596, Rules If You Have a Qualifying Child.

2019 IRS Tax Changes

Tax Reform Provisions that Affect Individuals

Standard Deduction Amount Increased

For 2019, those who are married and filing jointly will have a standard deduction of $24,400.

Single taxpayers and those who are married, and file separately now have a $12,200 standard deduction.

For heads of households, the deduction will be $18,350

Insurance Penalty

The penalty for not having health insurance no longer applies for 2019 federal tax returns. However, some states have their own individual health insurance mandate, requiring you to have qualifying health coverage or pay a penalty with your state tax return.

California has a new state individual health care mandate, which takes effect on January 1, 2020, and requires Californians to have qualifying health insurance coverage throughout the year, or pay a penalty based on your income and the number of people in your household.

Summary of possible penalties
Household Size If You Make Less Than You May Pay
Individual $45, 500 $695
Married Couple $91,000 $1,390
Family of 4 $140,200 $2,085

 

https://www.ftb.ca.gov/about-ftb/newsroom/news-articles/health-care-mandate.html

2019 Child Tax Credit

Under the new Tax Cuts and Jobs Act (TCJA) the following child tax credit changes will take place in 2019:

  • The Child Tax Credit under 2019 tax reform is worth up to $2,000 per qualifying child. The age cut-off remains at 17 (the child must be under 17 at the end of the year for taxpayers to claim the credit).
  • The refundable portion of the credit is limited to $1,400. This amount will be adjusted for inflation after 2019.
  • The earned income threshold for the refundable credit is lowered to $2,500.
  • The beginning credit phaseout for the CTC increases to $200,000 ($400,000 for joint filers). The phaseout also applies to the new family tax credit.
  • The child must have a valid SSN to claim the nonrefundable and refundable credit.

Child Tax Credit Eligibility

The child you claim as your dependent has to meet six IRS tests:

  1. Age Test: The child you claim as your dependent must have been under age 17 (so, 16 or younger) at the end of the tax year.
  2. Relationship Test:  The child must be your daughter, son, foster child or adopted child. The child can also be a grandchild or a descendant of one of your siblings.
  3. Support Test: The child must not have provided more than half of their own “support,” meaning the money they use for living expenses.
  4. Dependent Test: The child must be claimed as your dependent on your federal income tax return.
  5. Citizenship Test: The child must be a U.S. citizen, a U.S. national or a U.S. resident alien.
  6. Resident Test: The child must have lived with you for more than half of the tax year (with a few exceptions detailed on the Child Tax Credit worksheet).

In addition to these six tests, income is also an eligibility factor. As your modified adjusted gross income (MAGI) increases, the child tax credit begins to phase out. You’ll get $50 less in child tax credits for every $1,000 – or portion of $1,000 – that your modified AGI exceeds:

  • $75,000 if you’re filing as the head of your household, single or as a qualifying widow(er)
  • $110,000 if your filing status is married filing jointly
  • $55,000 if your filing status is married filing separately

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