IRS Publication 524 (Credit for the Elderly or the Disabled)

What is IRS Publication 524?

IRS Publication 524 (Credit for the Elderly or the Disabled) is an Internal Revenue Service (IRS) document that subtleties the qualification requirements for a tax credit that is accessible to individuals who have a low income and are aged 65 or more or disabled.

Those qualifying for the tax credit must be U.S. citizens or resident aliens aged somewhere around 65 or be retired due to permanent and total disability. A nonresident alien might be eligible for the credit whenever married to a citizen or resident alien.

Married couples normally need to file a joint tax return to qualify.

• This tax credit is accessible to individuals aged 65 or more and individuals who are permanently disabled.
• There are qualification limits in light of taxable and non-taxable income.
• The tax credit is guaranteed by connecting Schedule R to your Form 1040 or Form 1040-SR.

Understanding IRS Publication 524

This tax credit is simply accessible to those with lower incomes who are elderly, disabled, or both.

The cutoff for qualifying as of the 2020 tax year is $17,500 in adjusted gross income (AGI) for a single or bereaved person and $25,000 for a married couple if both qualify.

Even then, at that point, the filer may not qualify. A single person with no less than $5,000 in nontaxable income, for example, a pension doesn't qualify paying little mind to AGI. The limit is $7,500 for couples who both qualify.

What the Credit Is Worth

The amount of the credit that a taxpayer is due is calculated on a worksheet given by the IRS, albeit the IRS will crunch the numbers assuming the taxpayer likes.

Note that this is a tax credit. It decreases the amount of tax you owe dollar for dollar. (That is better than a tax deduction, which only decreases your taxable income.)

Nonetheless, it's a "nonrefundable" tax credit, truly intending that in the event that your credit is bigger than your tax bill, you'll owe zero taxes however the IRS will not send you the difference.

In a model the agency gives, a single taxpayer with an adjusted gross income of $13,100 is eligible for a tax credit of $71.

Download IRS Schedule R

This tax credit is guaranteed by filing Schedule R, Credit for the Elderly and the Disabled.