Earned Income Tax Credit for Foster Parents

Q: As a foster parent, can I claim the Earned Income Tax Credit? Are foster children “qualifying children?”

A: In short, yes: a foster child is a qualifying child for the purposes of the Earned Income Tax Credit. However the foster child must be “placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction.” The IRS specifies that an authorized placement agency includes a state or local government agency, a tax-exempt organization licensed by the state, an Indian tribal government or an organization authorized in an Indian tribal government.

In addition to meeting this relationship test, a “qualifying child” must also meet age, residency, and joint return tests requirements.

  •  Age: Child must be under age 19 at the end of 2013 or under age 24 at the end of 2013 and a student or permanently and totally disabled at any time during the year regardless of age.
  • Residency: Child must have lived with you in the United States for more than half of 2013.
  • Joint return: Child must not fil­e a joint return for 2013.

To claim the Earned Income Tax Credit with a qualifying child, you must file the Form 1040 or the Form 1040A, NOT the 1040EZ. You must also complete the Schedule EIC. If your income was less than $58,000 in 2013 you can file your taxes electronically free of charge at http://www.myfreetaxes.com

Source: Department of the Treasury Internal Revenue Service Publication 596

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