Advance Payment of the Earned Income Credit
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Advance payment of the EIC (for workers with a qualifying child)
If you expect to claim the EIC for tax year 2010, you may be able to get advance payments throughout the year instead of waiting until you file your taxes next year and receiving all of your EIC in one payment. This advance on the EIC can be added to your paychecks.
In 2010, you can get up to $1830 in advance EIC payments throughout the year. If your Earned Income Credit for the year is more than $1830, you will get the rest when you file your tax return next year.
You can only get the advance EIC if you have at least one qualifying child. If you are eligible for the EIC, but do not have a qualifying child, you may not apply for advance payment of EIC.
To apply for advance EIC payments you must complete Form W-5 (Earned Income Credit Advance Payment Certificate) and give it to your employer:
- You can download Form W-5 in PDF file format at the IRS web site: Form W-5.
- Your employer may be able to provide you with this form.
(To view the online form, you must have Adobe Reader installed on your computer. This is free software that you may download from the Adobe web site.)
If you apply for the advance EIC:
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You must fill out and give to your employer a Form W-5 each year.
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If information related to your eligibility changes in the course of the year, you should fill out a new Form W-5 and give it to your employer.
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If you have more than one employer, only complete one Form W-5.
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If you are married, both you and your spouse can fill out and give to your respective employers separate Form W-5s. There is a place to note this on the form.
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If you receive advance payments of EIC, you must file a federal income tax return to report the advance payments and claim any additional EIC you might be owed. You must file a return even if you would otherwise not have to file. You must use Form 1040A or Form 1040. You cannot use Form 1040EZ to report advance payments.
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