FAQ

1. Child tax Credit Information: 

https://www.whitehouse.gov/child-tax-credit/ 

https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021 

2. What is the difference between the California Earned Income Tax Credit and the Federal Earned Income Tax Credit? 

The differences between California and federal law for the Earned Income Tax Credit are as follows:

  • California allows this credit for wage income (wages, salaries, tips and other employee compensation) that is subject to California withholding.

  • If you were a nonresident, you must have earned wage income that is subject to California withholding.

  • Both your earned income and federal adjusted gross income (AGI) must be less than $56,844 to qualify for the federal credit, and less than $30,001 to qualify for the California credit.

  • An eligible individual without a qualifying child is 18 years or older for the California credit.

  • You may elect to include all of your (and/or all of your spouse's/RDP’s if filing jointly) nontaxable military combat pay in earned income for California purposes, whether or not you elect to include it for federal purposes. Get FTB Pub. 1032, Tax Information for Military Personnel, for special rules that apply to military personnel claiming the EITC.

  • California allows this credit to eligible individuals and their spouses who have a valid federal ITIN or who have qualifying children who have a valid federal ITIN.  Federal EITC requires US citizenship and a valid social security number.

  • Federal Earned Income Tax Credit requires that you have less than $10,000 of investment income for the tax year.

 

To qualify for the Federal EITC, you'll need: 

 

3. What is new this year?

Starting in tax year 2021, the amount of investment income they can receive and still be eligible for the EITC increases to $10,000. After 2021, the dollar amount could be changed.

Married but separated spouses can now claim EITC if they have a qualifying child living with them for more than half the year and either:

  • Do not have the same principal residence as the other spouse for at least the last six months out of the year.

  • Are legally separated according to their state law under a written separation agreement or a decree of separate maintenance and not live in the same household as their spouse at the end of the tax year for which the EITC is being claimed. 

  • Single people and couples with children who have Social Security numbers can are now eligible even if their children do not have SSNs.

 

4. What is a qualified Dependent?

A qualified dependent is a child  for whom you have legal guardianship or a. - similar arrangement that confers authority (and the corresponding duty) to care for the person and property of the child under applicable law. Each of your children until the end of the calendar year in which the child.

A qualifying child is a qualifying child under age 19 (or under 24 if a full-time student) or a qualifying relative who makes less than $4,300 a year (tax year 2021). A qualifying dependent may have a job, but you must provide more than half of their annual support.

A qualifying dependent must live with you for more than half the year, must be under the age of 19 (24 if a college student) and has not provided half of his/her own support.  If the dependent is over 19, he/she must be permanently and totally disabled

A qualifying relative must not be claimed on somebody else’s tax return, must live you the entire year and must be your child, stepchild, foster child or a descendant of any of them.  Your brother, sister, half-brother, half-sister, stepbrother or a descendant of any of them.  Your father, mother, grandparent, or stepparent, but not a foster parent.  Your son-in-law, daughter-in-law, mother-in-law, brother-in-law, or sister-in-law. Your uncle, aunt, nephew, or niece.  The person must earn less than $4,300 a year receive more than half of his or her support from you.

Your dependent must also have filed jointly with his or her spouse to claim a refund of the taxes withheld. Also, if he or she were to have filed separately from his or her spouse, neither would have owed taxes.and is either a U.S citizen, a U.S resident alien, a U.S national or a resident of Canada or Mexico.

 

5. What qualifies as income For California?

 income is defined as wages earned while working or self-employment income.  For Federal, income is defined as wages earned while working, self-employment and certain interest income earned from retirement accounts.

6. What is a California Resident

A California resident is someone who has spent more than nine months in this state.

 

7. How will my Stimulus and CTC affect my return

Neither the Stimulus or the Child Tax Credit is taxable.  If you did not receive your economic stimulus payment or the full or partial child tax credit, you can claim them on your return.

8. Check the status of your refund

Looking for your refund?  People with who qualify for EITC will not have their refunds processed until after February 15.  If you want to check the status of your Federal Refund, https://www.irs.gov/refunds or download the IRS2Go app https://www.irs.gov/newsroom/irs2goapp 

For California Returns, https://www.ftb.ca.gov/refund/index.asp?WT.ac=Home_Task_Refund 

 

9. I lost my Social Security Card

You can order a replacement card on line.  Go to 

https://www.ssa.gov/myaccount/?gclid=EAIaIQobChMI9qmlxqnE9wIVLnRvBB3g2AywEAAYASAAEgLktfD_BwE