Opinions

Duncan: New changes could help Sun City residents

Posted 12/1/21

The Mission of the Sun City Community Assistance Network is to, “Connect people with resources to enhance their standard of living.”

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Opinions

Duncan: New changes could help Sun City residents

Posted

The Mission of the Sun City Community Assistance Network is to, “Connect people with resources to enhance their standard of living.”

In other words, Sun City CAN helps people save money on things like property taxes, income taxes, utilities, Medicare premiums, prescription drugs and other things.

Many benefits go unclaimed simply because people are unaware that the benefits exist. In an effort to shed light on some of the help that is available to low-income seniors, I will write a guest commentary each month about a different senior help program.

Below is a listing of benefits available for low-income seniors that some may not realize are available.

Tax credit

Older than 65 and still working? New earned income credit changes might help.

Up until this year, this tax credit was only available to people under 65 years old. The American Rescue Plan changed this and now the age limit has been eliminated. If you are 65 or older and still working, you may be entitled to this tax credit.

What is the EIC and who is eligible?

The EIC is a refundable tax credit available to people who have low to moderate earned income. For a single person with no children, both your earned income and your adjusted gross income must be less than $21,430. For married couples, the limit is $27,380. If your income is below these limits, you might be eligible for this credit.

Also, the fact that this is a “refundable credit” is good news. Non-refundable credits can only be used to offset taxes owed. Refundable credits, like this one, come to you in the form of cash by direct deposit or check.

What is earned income?

In a nutshell, earned income is any income received for work, e.g. wages or business/self-employment income. Earned income is different from retirement income, such as a pension, an IRA, Social Security, interest, dividends or capital gains.

How much is the EIC?

The amount of the tax credit can be as little as $1 and as much as $1,502. 

What should you do?

This is a simplified discussion and there are many more rules concerning this entire issue. It is best handled by a tax professional.

One last quirk, the Internal Revenue Service will let you look back at your 2019 return and if your earned income was higher in that year, you can use the higher amount. Look at your situation for this year and your 2019 tax return and investigate whether you are entitled to the earned income credit.

Editor’s Note: Hugh Duncan is a retired Episcopal priest, a former nuclear engineer and a U.S. Navy retiree.

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