What you need to know about California’s earned income tax credit

A reader: Can you tell me what the earned income tax credit is? I keep hearing all about it but still don’t understand what it is.

Action Line: In checking with the California Franchise Tax Board, they tell us that last year, California began offering its own earned income tax credit to many people who make use of the federal EITC. The Cal EITC is refundable, meaning that taxpayers will receive money if the credit is greater than taxes owed. This credit was designed to put money BACK into the pockets of qualifying Californians. If you are eligible, all you need to do is file a tax return.

Here are some basics:

▪ Income: Your adjusted gross income and earned income may be up to $6,717 if there are no qualifying children, or up to $14,161 if there are two or more qualifying children.

▪ Tax filing status: You can file as single, married or registered domestic partner filing jointly, or head of household. To qualify for the credit, you cannot use married or registered domestic partner filing separately.

▪ Residency: Your principal home must have been in California for more than half the tax year.

▪ Qualifying child: The child must have had the same principal residence as the taxpayer in California for more than half the tax year (certain exceptions apply). Also, the child must be younger than the taxpayer and no older than either 19 at the end of the tax year, or 24 if the child is a full-time student for at least five months of the year. A permanently and totally disabled child may be included at any age, according to the state.

▪ Age: If you do not have a “qualifying child,” you (or your spouse, if you’re filing a joint return) must be between 25 and 65 years old.

To learn more, go to the state Franchise Tax Board at

Action Line is written by Blair Looney, president and CEO for the Better Business Bureau serving Central California. Send your consumer concerns, questions and problems to Action Line at the Better Business Bureau, 2600 W. Shaw Lane, Fresno, CA 93711 or