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Instructions for Form 1040-EZ

Line 8, Making Work Pay Credit(p12)


Who Can Take the Making Work Pay Credit(p12)

You may be able to take this credit if you have earned income from work. You cannot qualify for this credit if you are a nonresident alien or can be claimed as a dependent on someone else's tax return. If you are married and claim the credit on a joint return, nobody else is allowed to claim either you or your spouse as a dependent on his or her tax return.
The credit must be reduced if you received a $250 economic recovery payment during 2010. You may have received this payment in 2010 if you did not receive an economic recovery payment in 2009, but you received social security benefits, supplemental security income (SSI), railroad retirement benefits, or veterans disability compensation or pension benefits in November 2008, December 2008, or January 2009.
Use the worksheet for line 8 on the back of Form 1040EZ to figure your making work pay credit.
Social security number.(p12)
You (or your spouse if filing jointly) must have a valid social security number on your return to take the credit. A social security number does not include an identification number issued by the IRS. Only the Social Security Administration issues social security numbers.
Effect of credit on welfare benefits.(p12)
Any refund you receive as a result of the 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 the credit is not spent within a certain period of time, it can count as an asset (or resource) and affect your eligibility.

Instructions for Worksheet for Line 8–Making Work Pay Credit(p12)

Line 1a.(p12)
Complete the Earned Income Worksheet on this page and enter on line 1a the amount you figured using the worksheet if:
Earned Income Worksheet—Line 1a
1.Enter the amount from line 1 of Form 1040EZ1.
2.Enter the amount of any taxable scholarship or fellowship grant not reported on a Form W-2 but included on    
 line 1 above.2.  
3.Enter any amount received as a pension or annuity from a deferred compensation plan or a nongovernmental section 457 plan (enter "DFC" and the amount received in the space to the left of line 1 on Form 1040EZ). This amount may be shown on your Form W-2 in box 11. If you received such an amount but box 11 is blank contact your employer for the amount     
 received as a pension or annuity3.  
4.Enter the amount received for work performed while an inmate in a penal institution (enter "PRI" and the amount received in the space to the left of line 1    
 on Form 1040EZ)4.  
5.Add lines 2 through 45.
6.Subtract line 5 from line 16.
7.Enter the amount of any nontaxable combat pay received. Also enter this amount on line 1b of the Worksheet for Line 8 (on the back of Form 1040EZ). This amount should be shown in box 12   
 of your Form(s) W-2, with code Q.7.
8.Add lines 6 and 7. Enter the result here and on line 1a of the Worksheet for Line 8 (on the back of Form  
Line 1b.(p12)
Enter on line 1b the total nontaxable combat pay you (and your spouse if filing jointly) received in 2010. This amount should be shown in Form W-2, box 12, with code Q.
Line 10.(p12)
An economic recovery payment is a $250 payment sent to you by the U.S. Treasury during 2010 if you did not receive an economic recovery payment in 2009 but you received one of the types of benefits listed on line 10 in November 2008, December 2008, or January 2009. If you file jointly and both you and your spouse received those benefits, you each may have received an economic recovery payment.