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IRS.gov Website
Publication 554
taxmap/pubs/p554-013.htm#en_us_publink100043710

Chapter 5
Credits(p26)

This chapter briefly discusses the credit for the elderly or disabled, the child and dependent care credit, and the earned income credit. You may be able to reduce your federal income tax by claiming one or more of these credits.
taxmap/pubs/p554-013.htm#en_us_publink100043711

Credit for the Elderly
or the Disabled(p26)

rule
This section explains who qualifies for the credit for the elderly or the disabled and how to figure this credit. For more information, see Publication 524, Credit for the Elderly or the Disabled.
EIC
You can take the credit only if you file Form 1040 or Form 1040A. You cannot take the credit if you file Form 1040EZ or Form 1040NR.
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Can You Take the Credit?(p26)

rule
You can take the credit for the elderly or the disabled if: See Figure 5-A. and Figure 5-B, later.
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Qualified Individual(p26)

rule
You are a qualified individual for this credit if you are a U.S. citizen or resident alien, and either of the following applies.
  1. You were age 65 or older at the end of 2011.
  2. You were under age 65 at the end of 2011 and all three of the following statements are true.
    1. You retired on permanent and total disability (explained later).
    2. You received taxable disability income for 2011.
    3. On January 1, 2011, you had not reached mandatory retirement age (defined later under Disability income).
Deposit
Age 65. You are considered to be age 65 on the day before your 65th birthday. Therefore, you are considered to be age 65 at the end of 2011 if you were born before January 2, 1947.
taxmap/pubs/p554-013.htm#en_us_publink1000242363

Figure 5-A. Are You a Qualified Individual?

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U.S. citizen or resident alien.(p26)

rule
You must be a U.S. citizen or resident alien (or be treated as a resident alien) to take the credit. Generally, you cannot take the credit if you were a nonresident alien at any time during the tax year.
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Exceptions.(p26)
You may be able to take the credit if you are a nonresident alien who is married to a U.S. citizen or resident alien at the end of the tax year and you and your spouse choose to treat you as a U.S. resident alien. If you make that choice, both you and your spouse are taxed on your worldwide income.
If you were a nonresident alien at the beginning of the year and a resident alien at the end of the year, and you were married to a U.S. citizen or resident alien at the end of the year, you may be able to choose to be treated as a U.S. resident alien for the entire year. In that case, you may be allowed to take the credit.
For information on these choices, see chapter 1 of Publication 519, U.S. Tax Guide for Aliens.
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Married persons.(p26)

rule
Generally, if you are married at the end of the tax year, you and your spouse must file a joint return to take the credit. However, if you and your spouse did not live in the same household at any time during the tax year, you can file either a joint return or separate returns and still take the credit.
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Head of household.(p26)

rule
You can file as head of household and qualify to take the credit even if your spouse lived with you during the first 6 months of the year if you meet certain tests. See Publication 524 and Publication 501.
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Under age 65.(p26)

rule
If you are under age 65 at the end of the year, you can qualify for the credit only if you are retired on permanent and total disability and have taxable disability income (discussed later under Disability income). You are considered to be under age 65 at the end of 2011 if you were born after January 1, 1947. You are retired on permanent and total disability if:
Even if you do not retire formally, you may be considered retired on disability when you have stopped working because of your disability. If you retired on disability before 1977 and were not permanently and totally disabled at the time, you can qualify for the credit if you were permanently and totally disabled on January 1, 1976, or January 1, 1977.
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Permanent and total disability.(p27)
You are permanently and totally disabled if you cannot engage in any substantial gainful activity because of your physical or mental condition. A physician must certify that the condition has lasted or can be expected to last continuously for 12 months or more, or that the condition can be expected to result in death. See Physician's statement, later.
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Substantial gainful activity.(p27)
Substantial gainful activity is the performance of significant duties over a reasonable period of time while working for pay or profit, or in work generally done for pay or profit.
Full-time work (or part-time work done at the employer's convenience) in a competitive work situation for at least the minimum wage conclusively shows that you are able to engage in substantial gainful activity.
Substantial gainful activity is not work you do to take care of yourself or your home. It is not unpaid work on hobbies, institutional therapy or training, school attendance, clubs, social programs, and similar activities. However, doing this kind of work may show that you are able to engage in substantial gainful activity.
The fact that you have not worked for some time is not, of itself, conclusive evidence that you cannot engage in substantial gainful activity.
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Physician's statement.(p27)

rule
If you are under age 65, you must have your physician complete a statement certifying that you were permanently and totally disabled on the date you retired.
You do not have to file this statement with your tax return, but you must keep it for your records. The instructions for Schedule R (Form 1040A or 1040) include a statement your physician can complete and that you can keep for your records.
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Veterans.(p27)
If the Department of Veterans Affairs (VA) certifies that you are permanently and totally disabled, you can substitute VA Form 21-0172, Certification of Permanent and Total Disability, for the physician's statement you are required to keep. VA Form 21-0172 must be signed by a person authorized by the VA to do so. You can get this form from your local VA regional office.
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Physician's statement obtained in earlier year.(p27)
If you got a physician's statement in an earlier year and, due to your continued disabled condition, you were unable to engage in any substantial gainful activity during 2011, you may not need to get another physician's statement for 2011. For a detailed explanation of the conditions you must meet, see the instructions for Schedule R (Form 1040A or 1040), Part II. If you meet the required conditions, you must check the box on Schedule R (Form 1040A or 1040), Part II, line 2.
If you checked Schedule R (Form 1040A or 1040), Part I, box 4, 5, or 6, print in the space above the box in Part II, line 2, the first name(s) of the spouse(s) for whom the box is checked.
taxmap/pubs/p554-013.htm#en_us_publink100043727

Disability income.(p27)

rule
If you are under age 65, you must also have taxable disability income to qualify for the credit.
Disability income must meet the following two requirements.
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Payments that are not disability income.(p27)
Any payment you receive from a plan that does not provide for disability retirement is not disability income. Any lump-sum payment for accrued annual leave that you receive when you retire on disability is a salary payment and is not disability income.
For purposes of the credit for the elderly or the disabled, disability income does not include amounts you receive after you reach mandatory retirement age. Mandatory retirement age is the age set by your employer at which you would have had to retire had you not become disabled.
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Figuring the Credit(p27)

rule
You can figure the credit yourself, or the IRS will figure it for you.
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Figuring the credit yourself.(p27)

rule
If you figure the credit yourself, fill out the front of Schedule R (Form 1040A or 1040). Next, fill out Schedule R (Form 1040A or 1040), Part III.
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Credit figured for you.(p27)

rule
If you can take the credit and choose to have the IRS figure the credit for you, see Publication 524 or the Instructions for Schedule R (Form 1040A or 1040). If you want the IRS to figure your tax, see Chapter 29 of Publication 17, Your Federal Income Tax.