IRS Publication 596

AAA

DEFINITION of 'IRS Publication 596'

A document published by the Internal Revenue Service (IRS) that provides information on the earned income credit (EIC) available to individuals earning below a certain income level. In order to qualify to receive the EIC, a taxpayer must have an adjusted gross income (AGI) that falls below a certain threshold, have a valid Social Security number, cannot be married but filing separately, must be a U.S. citizen or resident alien, must not have a high level of investment income and must be employed. If the taxpayer does not have a qualifying child then he or she must be between the ages of 25 and 65.

INVESTOPEDIA EXPLAINS 'IRS Publication 596'

In order to received the earned income credit, Form 1040 must be filed with the IRS. The taxpayer can then have the IRS determine the amount of EIC, or can use a worksheet to make the calculations. Certain taxpayers are also able to claim an advanced EIC payment if they expect to have a child within the year or earn an income below the qualifying threshold.

RELATED TERMS
  1. Poverty

    A state or condition in which a person or community lacks the ...
  2. Adjusted Gross Income - AGI

    A measure of income used to determine how much of your income ...
  3. Earned Income Credit - EIC

    A tax credit in the United States which benefits certain taxpayers ...
  4. Tax Credit

    An amount of money that a taxpayer is able to subtract from the ...
  5. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  6. 1040 Form

    The standard Internal Revenue Service (IRS) form that individuals ...
Related Articles
  1. Taxes

    Taxing Times For Divorced Parents

    Find out how to deal with the tax issues that arise for divorced parents with dependent children.
  2. Fundamental Analysis

    Standard Of Living Vs. Quality Of Life

    What is the difference between a standard of living and quality of life? Find out in this breakdown.
  3. Personal Finance

    Are We Losing The Middle Class?

    Find out where your income and lifestyle put you compared to the national average.
  4. Insurance

    The Minimum Wage: Does It Matter?

    Despite paying one of the highest minimum wages in the world, the minimum wage is a perpetual hot potato among politicians in the United States.
  5. Savings

    How Microeconomics Affects Everyday Life

    Microeconomics is the study of how individuals and businesses make decisions to maximize satisfaction. Microeconomic principles can describe many everyday experiences. We use renting a New York ...
  6. Taxes

    How Does An IRS Audit Work?

    It doesn't automatically mean an IRS agent will be ringing your doorbell. Here are the different types of IRS audits and how to handle them.
  7. Taxes

    Switzerland's Declining Tax Haven Appeal

    Switzerland's tax haven allure is being threatened by efforts by the US and other governments to make Swiss banks give up their much-vaunted secrecy.
  8. Taxes

    Are You Missing Out On These Tax Exemptions?

    To lower your tax bill, make sure that you're taking all the exemptions that apply to you.
  9. Economics

    Venezuela Teeters On Edge As Oil Revenues Shrink

    Low oil prices have drastically revised the economic status quo -- dealing a destabilizing blow to oil-exporters like Venezuela due to falling oil revenue.
  10. Economics

    What Must The UK Do To Keep North Sea Oil Afloat?

    The UK government may need to take drastic action to ensure the viability of UK North Sea offshore oil production amid high costs and shrinking margins.

You May Also Like

Hot Definitions
  1. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  2. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  3. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  4. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  5. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  6. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
Trading Center