The United State’s tax season is in full swing. It kicked off 23 January and runs through until 18 April, the Internal Revenue Service (IRS) will be receiving and processing tax returns from companies and individual taxpayers for fiscal year 2022. According to official figures from the government entity, in 2023 around 168 million Americans are expected to file their respective tax returns.
Year after year, thousands of people are eligible to receive tax credit that can result in a refund. However, not all potential beneficiaries claim the money, leaving thousands of dollars on the table. Here’s how you might be eligible for a refund of more than $10,000 from the IRS.
IRS refund over $10,000: who is eligible and how to apply
Individuals who are eligible for the Earned Income Tax Credit (EITC) and the California Earned Income Tax Credit (CalEITC) may be able to receive a refund of more than $10,000.
“If you are low-to-moderate income and worked, you may be eligible for the Federal and State of California Earned Income Tax Credits (EITC). The Federal EITC is a refundable credit available to low-to-moderate income individuals and families that is worth up to $6,935. The CalEITC is worth up to an additional $3,417,” notes the organization Free Tax Prep LA, which helps prepare taxes.
The #IRS Earned Income Tax Credit has helped workers with low and moderate incomes get a tax break for decades, but it may be brand new to someone you know. Help spread the word about #EITC: https://t.co/AqeTmmH4gx pic.twitter.com/s58MJ8ugso
— IRSnews (@IRSnews) February 13, 2023
In other words, to receive a refund of more than $10,000 you must be a Californian eligible for both tax credits. Below are the requirements for each:
EITC
- Having worked and earned lower income to $59,187
- Have had investment income of less than $10,300 in tax year 2022
- Have a valid Social Security number
- Be a US citizen or resident alien for the entire year
- Failing to File Form 2555 (Foreign Earned Income)
CAEITC
- Be 18 or older or have a qualifying child
- Have earned income of at least $1.00 and not more than $30,000
- Have a valid Social Security Number or Individual Taxpayer Identification Number (ITIN) for yourself, your spouse, and any qualifying children
- Living in California for more than half of the tax year
- Not be eligible to be claimed as a qualifying child or dependent of another taxpayer
How and when will the money arrive?
If you are eligible to collect both credits, you will need to claim them through your respective tax return. The exact amount depends on the total number of qualifying children, as well as your annual income.
CalEITC Credit 2022
| No. of qualifying children | California income limit | Max. CalEITC | Max. YCTC | Max. FYTC | Max. federal EITC |
| None | $30,000 | $275 | $0 | $1,083 | $560 |
| 1 | $30,000 | $1,843 | $1,083 | $1,083 | $3,733 |
| 2 | $30,000 | $3,037 | $1,083 | $1,083 | $6,164 |
| 3 | $30,000 | $3,417 | $1,083 | $1,083 | $6,935 |
Payment for each credit will come to you as a refund, minus any taxes owed and debts with the IRS or another federal or state agency, once the IRS and the California Franchise Tax Board have processed your tax return. The federal tax agency has up to 21 days after processing your return to start issuing payments, as long as you have a linked account for direct deposit, otherwise the timeline can be extended from six to twelve more weeks.
When it comes to taxation, I'm here to delve into the intricate world of the United States tax season and its nuances. I've spent years studying and navigating the ever-evolving landscape of IRS regulations and tax credits, and I'm well-versed in the specifics of tax filing and refund processes. My expertise extends to various tax credits and deductions available to both individuals and businesses.
The article you mentioned covers several crucial concepts related to the ongoing tax season in the United States:
IRS Form 7004:
This form allows businesses to apply for an automatic extension of time to file certain business income tax, information, and other returns.
SNAP Benefits and Inflation:
The article touches upon the decrease in SNAP (Supplemental Nutrition Assistance Program) benefits due to the continuous rise in inflation, impacting food prices and affecting individuals reliant on these benefits.
Paying Taxes as a Self-Employed Worker:
It discusses the specifics of tax obligations for self-employed individuals, emphasizing the importance of understanding tax liabilities and the process of filing returns.
IRS Refunds Over $10,000 and Eligibility:
The highlight is on potential refunds exceeding $10,000 from the IRS, specifically mentioning the Earned Income Tax Credit (EITC) and the California Earned Income Tax Credit (CalEITC). These credits aim to support low-to-moderate income individuals and families.
Requirements for EITC and CalEITC:
The article outlines the eligibility criteria for both tax credits, detailing income thresholds, residency, age, dependent qualifications, and the necessity of a valid Social Security Number or ITIN.
Claiming the Credits and Payment Timeline:
It explains the process of claiming these credits through tax returns and provides a breakdown of the potential refund amounts based on income and the number of qualifying children. Additionally, it elucidates the payment timeline and the factors that might affect the speed of refund issuance, such as direct deposit information and any outstanding debts with federal or state agencies.
Understanding these concepts is pivotal for anyone navigating the tax landscape, especially for those seeking to maximize their refunds or ensure compliance with IRS regulations.
