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Virginia's EIC credit
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Greta
Level 9
02-05-2024
07:21 PM
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Spouse age 57 earned $7K and received $600 EIC on the federal return. Husband age 67 received social security benefits of 10K and no other income. Why does the VA software deny them the 15% of EIC credit in Virginia?
Virginia gives a 12K old age deduction which does this couple no good. But I just realized why the EIC is denied because they got the phantom "benefit" of the 12K old age deduction.
This poorly formulated law really hurts my clients who are grandparents rearing grandchildren and continue to work to support them. They thankfully get a large federal EIC but are denied Virginia's EIC the year they turn 65. That's a big loss over the many yrs of child rearing yet to come. No double dipping, even though the 12K deduction does them no good at their puny income level. But Virginia says the deduction takes priority over the credit. So No credit. Legislators are not tax preparers, they don't get it.
They did let wealthy veterans double dip -- they get both the age deduction and the 20K deduction for being veterans. Only wealthy folks can make use of both.
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