August 13, 2010 12:00 am

Advance Earned Income Credit Dies

After more than 30 years, the opportunity for low-income workers to receive the earned income credit on an advanced basis has ended. Effective after 2010, eligible workers will have to wait until they file their returns to claim the earned income credit.

It has been estimated that only 1% of workers eligible to receive the credit on an advanced basis took advantage of the opportunity. The elimination of this provision helped to fund the Education Jobs and Medicaid Assistance Act of 2010, which was signed into law on August 10, 2010.

Source: Education Jobs and Medicaid Assistance Act of 2010 (H.R. 1586)

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Tax Glossary

Fiscal year

A 12-month period ending on the last day of any month other than December. Partnerships, S corporations, and personal service corporations are limited in their choice of fiscal years and face special restrictions.

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