Beginning with tax year 2007, Nebraska taxpayers receive a refundable earned income tax credit equal to 10% of any federal earned income tax credit received. The federal earned income tax credit is a refundable credit available to low-income, working taxpayers.
What is the Nebraska Earned Income Credit?
The credit is calculated as a percentage of the earned income of the individual, up to a phase-out amount. Once the individual reaches the lower reaches of the middle class the credit is phased out. For 2006, $412 was the maximum credit for an individual with no children, $2,747 for an individual with one child, and $4,536 for an individual with two or more. The credit began phasing out once earned income exceeded $6,740 for an individual with no children and $14,810 for individuals with one or more children.
Claiming 2016 Nebraska Earned Income Credit
Taxpayers who qualify for and claim the Earned Income Tax Credit (EITC) could pay less federal tax, pay no tax or even get a tax refund beyond the amount of tax withheld, according to the Department of Health and Human Services (DHHS). EITC is a refundable tax credit for eligible workers with low to middle incomes.
Claiming Nebraska EITC
To help Nebraskans take advantage of the EITC program, DHHS works with community organizations to provide free tax preparation assistance by IRS-certified volunteers to low income individuals and families. To locate a site near you, or if you have eligibility questions, call 2-1-1 or 1-800-829-1040.
More Information about Nebraska Earned Income Credit
Nebraska Earned Income Credit. Paper filers must attach a copy of pages 1 and 2 of Federal Form 1040 or 1040A, or page 1 of Form 1040EZ to your Nebraska return. Nebraska residents and partial-year residents who have a federal earned income credit are allowed a state credit equal to 10% of the federal credit. Complete the federal credit information from line 8a (Form 1040EZ), line 38a (Form 1040A), or line 64a (Form 1040). Enter the number of qualifying children using information from Federal Schedule EIC (Form 1040 or 1040A). If you are a nonresident or file a married, filing separately, you cannot claim this credit.
Partial Year Residents Claiming Nebraska EITC
Partial-year residents enter amount calculated on Nebraska Schedule III, line 88. Partial-year residents may claim this credit by entering the number of qualifying children on line 87a, and the federal earned income credit information on line 87b. The allowable credit is 10% of the federal credit multiplied by the ratio calculated on line 80. Enter result on line 88 and on line 33. To receive this credit, paper filers must attach a copy of pages 1 and 2 of their federal return. Nonresidents cannot claim the Nebraska earned income credit.