Use Schedule M to figure the following two credits.
- Making work pay credit.
- Government retiree credit.
Both credits are included in the combined total on line 14 of Schedule M. Each credit has different rules. Carefully read the information below about each credit. Even if you cannot take the making work pay credit (for example, because your adjusted gross income is too high), you may be able to take the government retiree credit.
You may be able to take a credit of up to $400 ($800 if married filing jointly) if you have earned income from work. Even if your federal income tax withholding was reduced during 2009 because of the credit, you must complete Schedule M and claim the credit on your return to benefit from it. You cannot take the credit if the amount you enter on line 5 is $95,000 ($190,000 if married filing jointly) or more, you are a nonresident alien, or you can be claimed as a dependent on someone else's return. The credit is reduced if either of the following statements is true.
- You (or your spouse, if filing jointly) received a $250 economic recovery payment during 2009. You may have received an economic recovery payment if you received social security benefits, supplemental security income (SSI) benefits, railroad retirement benefits, or veterans disability compensation or pension benefits.
- You take the government retiree credit discussed next.
You can take a credit of $250 ($500 if married filing jointly and both spouses qualify) if you (or your spouse, if filing jointly) received a pension or annuity payment in 2009 for service performed for the U.S. Government or any U.S. state or local government (or any agency of one or more of these) and the service was not covered by social security. But you cannot take the credit if you and your spouse both received a $250 economic recovery payment during 2009. You may have received an economic recovery payment if you received social security benefits, SSI benefits, railroad retirement benefits, or veterans disability compensation or pension benefits.taxmap/instr/i1040sm-001.htm#TXMP5eff604a
To take either credit, you must include your social security number (if filing a joint return, the number of either you or your spouse) on your return. A social security number does not include an identification number issued by the IRS.taxmap/instr/i1040sm-001.htm#TXMP47615aaa
Any refund you receive as a result of either credit will not be used to determine if you are eligible for the following programs, or how much you can receive from them. But if the refund you receive because of either credit is not spent within a certain period of time, it may count as an asset (or resource) and affect your eligibility.
- Temporary Assistance for Needy Families (TANF).
- Medicaid and SSI.
- Supplemental Nutrition Assistance Program (food stamps) and low-income housing.