In 2013,Alex has income from wages of $16,000,adjusted gross income of $18,000,and tax liability of $300 before the earned income credit.What is the amount of Alex's earned income credit for 2013,assuming his 5-year-old dependent son lived with him for the full year?

Question

Quizplus · Accepted Answer

To calculate the Earned Income Credit (EIC) for 2013, we need to first determine Alex's earned income. This is his income from wages, $16,000. As his AGI is less than $38,889, for a taxpayer with one qualifying child, we can use Table 4 in the EIC instructions to determine the credit.

From Table 4, we can see that for a taxpayer with one qualifying child and earned income of $16,000, the credit is $3,171. As Alex's tax liability before the EIC is only $300, he can claim the full credit of $3,171, which will reduce his tax liability to zero and result in a refund of the remaining credit. Therefore, the correct answer is (C) $3,171.

In 2013,Alex Has Income from Wages of $16,000,adjusted Gross Income