Filing
Status

and at the end of 2015 the taxpayer was:

the taxpayer must file a tax return if his gross income was at least:

$4,000

If the taxpayer’s filing status is:

The standard deduction is:

If 65 or over AND/OR blind add for EACH

$6,300

$12,600

$1,250

$6,300

$9,250

• Wages, salaries, and tips
• Commissions
• Jury Duty pay
• Union strike benefits
• Long-term disability pensions received prior to minimum retirement age
• Net earnings from self employment

Earned Income Does Not Include The Following:

• Interest and dividends
• Social security and railroad retirement benefits
• Welfare benefits
• Pensions or annuities
• Veterans’ benefits (including VA rehabilitation payments)
• Workers’ compensation benefits
• Alimony
• Child support
• Unemployment compensation (insurance)
• Taxable scholarship or fellowship grants that were not reported on Form W-2
• Variable housing allowance for the military
• Earnings for work performed while an inmate at a penal institution.

A Qualifying Child Must:

• be a son, daughter, stepchild, adopted/foster child, brother, sister, stepbrother, stepsister, or a descendent of any of them (i.e. grandchild)
• be under age 19, or under age 24 and a full time student (enrolled full time during any 5 months)
• be any age if permanently disabled
• not provide more than one-half of his or her own support
• have lived with the taxpayer for more than 6 months in the United States, except in the case of newborns and adoption. A full year is required for foster care
• have an SSN, unless the child was born and died during the tax year
• be younger than the person claiming him/her
• not have filed a joint tax return other than to claim a refund

To Qualify, All Of The Following Tests Must Be Met:

• the taxpayer must have earned income
• the taxpayer’s filing status cannot be married filing separately
• the taxpayer cannot be the qualifying child of another person
• the taxpayer must include his SSN on the return, and if married, that of his spouse
• earned income and AGI must each be less than: 

Disqualified income
The taxpayer is not eligible for the earned income credit if he had “disqualified income” exceeding $3,400. Disqualified income includes both taxable and tax exempt interest, dividends, net rent and royalty income, net capital gains, and net passive income that is not self employment income.

Claiming The Earned Income Credit Without A Qualifying Child
If the taxpayer does not have a qualifying child, then the taxpayer must

• have earned income as detailed above
• have a main home in the US for more than six months of the tax year
• be at least 25 years old, but under age 65, at the end of the tax year. On joint returns either spouse may satisfy this test
• file a joint tax return if married, unless the taxpayers lived apart for the last six months of the tax year, and this taxpayer qualifies to file as Head of Household
• not be the dependent or qualifying child of another taxpayer. This rule includes a spouse
• include his SSN on the return, and if married, that of his spouse

Tie-Breaker Rules
If both parents are eligible to claim the credit for the same qualifying child and they do not file a joint return the parent with whom the child resided for the longer period of time during the tax year claims the credit. If the child lived with each parent for the same amount of time the parent with the higher AGI claims the credit.

If a parent and one or more non-parents are entitled to claim the child as a qualifying child, only the parent may claim the credit. If none of the persons entitled to claim the child are a parent the person with the higher AGI claims the credit.

Married Children
If the taxpayer’s child was married at the end of the tax year, he or she can be the taxpayer’s qualifying child only if the taxpayer can claim an exemption for the child.

Nonresident Aliens
An individual who is a nonresident alien for any part of the tax year is not eligible for the credit unless he or she is married and an election is made by the couple to have all of their worldwide income subject to U.S. income tax.

Tax Year

$100 Rule

10% Rule

Apply this rule as if you were one person.Apply this rule separately to each spouse.

Apply this rule as if you were one person.

Apply this rule separately to each spouse.

You CAN deduct the following…

You CANNOT deduct the following…

• Admission and transportation to a medical conference relating to the chronic disease of a dependent, if it is primarily for and essential to the care of the dependent 
• Birth control pills prescribed by your doctor
• Capital expenses for equipment or improvements to your home needed for medical care, or to make the home suitable for a disabled person. (See IRS tax Publication 502)
• Cost and care of guide dogs or other animals aiding the blind, deaf or disabled.
• Cost of lead-based paint removal (See IRS tax Publication 502)
• Dental and orthodontic care
• Expenses of an organ donor.
• Hospital services fees (lab work, therapy, nursing services, surgery, etc.)
• Legal abortion
• Legal operation to prevent having children.
• Meals and lodging provided by a hospital during medical treatment.
• Medical, hospital, dental and long-term care insurance premiums (subject to the age limits) (See IRS tax Publication 17 for details).
• Medical services fees (from doctors, dentists, surgeons, specialists, and other medical practitioners.)
• Medicare A premiums for persons not enrolled in Social Security, and Medicare B premiums
• Oxygen equipment and oxygen
• Part of life-care fee paid to retirement home designated for medical care.
• Prescription medicines (those requiring a prescription by a doctor for their use by an individual) and insulin.
• Psychiatric care at a specially equipped medical center (includes meals and lodging.)
• Social Security tax, Medicare tax, FUTA, and state employment tax for worker providing medical care (See Wages for nursing services below.)
• Special items (artificial limbs, false teeth, eyeglasses, contact lenses, hearing aids, crutches, wheelchairs, braces, etc.)
• Special school or home for mentally or physically disabled persons (see IRS taxPublication 502 for details).
• Stop smoking programs, including cost of prescription drugs designed to alleviate nicotine withdrawal.
• Transportation for needed medical care at the IRS published rate per mile, or actual out-of-pocket expenses, plus parking fees and tolls. (See IRS tax Publication 17 for details).
• Treatment at drug or alcohol center (includes meals and lodging provided by the center.)
• Wages for nursing services ( see IRS taxPublication 502)
• Weight-loss programs to treat obesity and other diseases diagnosed by a physician

• Diaper service
• Diet foods
• Expenses for your general health (even if following your doctor’s advice. However if you doctor has recommended a program as treatment for a specific condition, the IRS has indicated that the cost would be deductible) such as

– Health club dues
– Household help (even if recommended by a doctor.)
– Social activities, such as dancing or swimming lessons.
– Trip for general health improvement.
– Weight loss program.

• Funeral, burial or cremation expenses.
• Illegal operation or treatment.
• Life insurance or income protection policies, or policies providing payment for loss of life, limb, sight, etc.
• Maternity clothes
• Meals and lodging while attending a medical conference related to the chronic disease of a dependent
• Medical expenses paid from a medical savings account (MSA).
• Medical expenses paid from a flexible savings account (FSA)
• Medical insurance included in a car insurance policy covering all persons injured in or by your car.
• Medical insurance premiums paid with pre-tax dollars
• Medicine you buy without a prescription.
• Nonprescription drugs or medicines.
• Nonprescription nicotine gum, patches, or lozenges.
• Nursing home policies, if the policy ensures a maximum out-of-pocket expense per day.
• Babysitting, childcare, and nursing care for a healthy baby.
• Payroll tax paid for Medicare A.
• Surgery for purely cosmetic reasons.
• Toothpaste, toiletries, cosmetics, etc.