Tax-Free Savings Accounts for People with Disabilities
A new law just passed by Congress and signed by President Obama will allow people with disabilities who became disabled befor...Read more
Many people with disabilities work, even Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI) recipients. But in most cases, these workers don't earn enough money from their jobs to meet the $10,300 gross income threshold (for a single person) for filing a federal income tax return, so they don't file their taxes on April 15th. After all, who needs the hassle?
The Earned Income Tax Credit gives people with disabilities an incentive to file a tax return even if they are not required to do so. This credit, which applies to single people with earned income of less than $14,880 and married couples filing jointly who earned less than $20,430 (during 2016), could provide a refund of approximately $500. Beneficiaries with children have higher income requirements and the maximum refund is also higher. The IRS estimates that as many as 1.5 million people with disabilities miss out on this valuable credit because they fail to file a tax return.
If you are familiar with the Social Security Administration's prohibitive income and resource limits, especially for people receiving SSI, you might be worried that this extra $500 could affect your or a loved one’s access to that invaluable program. Fortunately, the Earned Income Tax Credit is not counted as income for any federal benefit program, including SSI, Medicaid or Section 8 housing, and it will not count as a resource for one year, giving beneficiaries every incentive to apply for the credit.
To learn more about the Earned Income Tax Credit from the IRS website, click here.