Karen Lee Posted February 16, 2009 Report Posted February 16, 2009 Have sub s with 13789. on Sch E, pg 2, non passive income. Have 7453. in W-2 wages. Earned income worksheet only uses Line 7 wages for calculating EITC. Is this correct? What am I missing? AGI 21374.00, 3 qualifying children, MFJ. Investment income 132.00 Followed the worksheets all the way through and I just don't get it. EITC 2990. and not 4227. why? Karen Quote
jainen Posted February 16, 2009 Report Posted February 16, 2009 >>Followed the worksheets all the way through<< Doesn't the second line pick up income from Schedule SE? Quote
Maribeth Posted February 16, 2009 Report Posted February 16, 2009 Have sub s with 13789. on Sch E, pg 2, non passive income. Have 7453. in W-2 wages. Earned income worksheet only uses Line 7 wages for calculating EITC. Is this correct? What am I missing? AGI 21374.00, 3 qualifying children, MFJ. Investment income 132.00 Followed the worksheets all the way through and I just don't get it. EITC 2990. and not 4227. why? Karen The income from the S-corp that is distriubted to your client off of a K-1 is not earned income. Only the W-2 wages from the S-corp would qualify. Maribeth Quote
taxtrio Posted February 16, 2009 Report Posted February 16, 2009 Correct. No social security or SE tax then no earned income. They can't have it both ways! Taxtrio Quote
joanmcq Posted February 17, 2009 Report Posted February 17, 2009 Ooops, maybe they shouldn't have taken so much in distributions....need a 'reasonable wage'!!! Quote
Karen Lee Posted February 17, 2009 Author Report Posted February 17, 2009 Actually had a reasonable wage. Profit from loan repayments not effecting Income Statement. Cash flow effected. OK, sub S profits not earned income. They are about done with loan payments so we will increase wages for 2009. Thanks for all your help. Karen Quote
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