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Old 09-04-2007, 06:05 PM
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Is the child support considered income when calculating the earned income credit?

Will my daughter who receives child support from her ex-husband be considered income when calculating the her earned income credit?

Tks..



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Old 09-16-2007, 10:50 AM
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Unfortunately for you, the IRS specificially states that "for purposes of calculating the earned income Credit, child support is not considered earned income".

IRS defines "Earned income" that is generally meant to be include wages, salaries, tips, other taxable employee pay, and net earnings from self-employment. Employee pay is earned income only if it is taxable.

Also, nontaxable employee pay, such as certain dependent care benefits and adoption benefits, is not considered earned income. But there is an exception for nontaxable combat pay, which you can choose to include in earned income.

Earned income is further explained in detail in Rule 7 in chapter 1 of Publication 596, Earned Income Credit.

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