Will your refund be frozen due to refundable credits?
In order to reduce fraud this tax season, the IRS will freeze all of your refund until February 27, 2018 if you are requesting certain credits such as the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC) which are refundable credits.
Refundable credits mean that even if you do not owe any tax, the credits will be refunded. You could file your tax return and request these credits even if you are not required to file a tax return.
Almost 27 million taxpayers were granted $65 billion for this credit in 2017.
The EITC is a credit given for you or your children that meet the requirements and is based on earned income.
Workers, self-employed, contract workers, and farmers with children that earned $53,930 or less during 2017 could be eligible for refundable credits. If you have 3 (or more) children, the maximum credit is $6,318; for 2 children, the maximum credit is $5,616; for 1 child, the maximum credit is $3,400. Those that do not have qualifying children could be eligible if they have earned income of $20,600 or less. The maximum credit for them is $510.
The ACTC is a credit that does not place a limit on the number of qualifying children you may have and has a maximum of $1,000 per child. People with ITINs can request this credit.
Ask your VITA preparer or other reliable tax preparer if you think you qualify. Problems with the IRS? Legal Aid of Western Missouri’s Low Income Taxpayer Clinic (816-474-6750) could offer free help if you qualify.
