Chapter 6
Advance Payment of EIC in 2001

You can receive part of your 2001 EIC in your paycheck by completing a form and giving it to your employer.

Do you expect to be eligible for the EIC this year (2001) and to have a qualifying child? If so, you can choose to get payments of the EIC in your paycheck now instead of waiting to get your EIC all at once in 2002 when you file your tax return for the year 2001. These payments are called advance EIC payments. This chapter explains how you may be able to get them this year and how to report them on your tax return.

Example. How advance payment of EIC works In March of 2001, John and Tom worked together. Tom told John that he gets $40 added to his paycheck each month because of the earned income credit. John would like to get an extra amount every month too. John needs to find out if he can claim the EIC in 2001. He should answer the questions in Step 1 below and then, if he is eligible for advance EIC payments, go to Step 2.

Note. Chapters 1 through 5 of this publication are about the EIC you claim on your 2000 tax return. This chapter is about the EIC you expect to claim on your 2001 tax return.

Step 1 - Find Out If You Are Eligible for Advance Payments of the EIC

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