EIC for inmate

[Jesse]

40 year old person worked and had wages of $5,000 before going to jail which results in EIC being calculated. Would there be other issues that would restrict the taxpayer in the EIC eligibility? There are not children involved - EIC for taxpayer w/out a qualifying child.

I know the amounts received for work performed while an inmate are not included in calculating the EIC.

[erchess]

When I was new in the tax business I learned

that someone who was in prison at the time of filing could not get EIC even if they otherwise qualified. However, I cannot find anything to that effect in TTB or IRS Pub 596 to back me up. Is anyone out there such as NYEA able to help us out?

[New York Enrolled Agent]

I can't answer with 100% certainity but I tend to think it does qualify.

As Jesse notes IRC §32 addresses the situation where a taxpayer is incarcerated. The section below excludes money earned in jail from being considered earned income.

§32(c)(2)(B)(iv) - "no amount received for services provided by an individual while the individual is an inmate at a penal institution shall be taken into account, "

It doesn't appear (at least to me) that Congress intended to exclude EIC in Jesses's fact pattern.

[Jesse]

Thanks, in the back of my mind I thought that I read/heard than an incarcerated person was not eligible for the EIC. The only info I can find is the wage deduction for earnings while incarcerated.

Appears he'll get WI Homestead also.

[Bill Tubbs]

Homestead

Thanks, in the back of my mind I thought that I read/heard than an incarcerated person was not eligible for the EIC. The only info I can find is the wage deduction for earnings while incarcerated.

Appears he'll get WI Homestead also.

A couple years ago I had a part-year inmate -- was eligible for Homestead Credit -- but he made more than $12,000 so EIC wasn't an issue for me. But I don't know of anything that would exclude him from EIC in your case.

Bill