There is great news for this tax season for California’s hard working families and individuals. California now offers an Earned Income Tax Credit for the working people of California. Cal EITC (California Earned Income Tax Credit) will start for the first time with 2015 tax returns. This new tax credit helps put the hard working money you’ve earned back in your pockets.
One benefit to this new tax credit is, if you owe taxes the Cal EITC can actually reduce the amount you owe and even provide you with a refund. If you don’t owe any taxes then the Cal EITC will issue a refund.
You can qualify for the California Earned Income Tax Credit if your income is within certain limits and you have an issued Social Security Number. You must also have a filing status of anything other than “Married Filing Separately” and have lived in California for more than half of the current tax year. The Cal EITC is not available to individuals who are self-employed.
Many Californian’s are wondering how much the tax credit is. Well, it depends on your qualifying family size and income. Below shows a few examples of tax credit amounts.
A family who doesn’t have any qualifying children and makes less than $6,580 a month (the maximum income amount for an individual with no qualifying children) then your Cal EITC is estimated to be around $214. If you do not have any qualifying children, you and your spouse must be between 25 and 65 years old to qualify.
For a family with 1 qualifying child and a maximum monthly income of $9,880, your tax credit is roughly $1,428.
For a family with 2 qualifying children and a maximum monthly income of $13,870, your tax credit would be up to $2,358.
For a family with 3 or more qualifying children and a maximum monthly income of $13,870, your tax credit would be around $2,653.
In order for your child/children to be considered qualified they must match the following criteria:
To claim the tax credit, you will need to file a California Income Tax Return and complete the Earned Income Tax Credit form, Form FTB 3514. You can choose free tax filing options or hire a preparer who can help you file your 2015 taxes. Tax preparers have certain requirements they must meet when they are determining a taxpayer’s eligibility for the Cal EITC, so you may be asked a series of questions in regards to your qualifying requirements.
If you have questions about anything you read in this article, the expert staff and HR partners here at PAYDAY can help. The staff here can also assist you with providing easy access to employee’s Forms W2 for tax filing purposes. Feel free to give us a call anytime at (714) 467-3434 and one of our expert staff will be happy to assist you.
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