Based on information provided by the California Franchise Tax Board, UltraTax/1040-California calculates the EIC - Criteria to Qualify Worksheet in order to determine if taxpayer is eligible for the California Earned Income Tax Credit. All filers must meet certain criteria in order to claim the credit, including the following:.

• Federal AGI Limitation: Based on the number of qualifying children in the Qualifying children statement dialog, federal AGI must be below a certain threshold.
• Valid Social Security Number: Taxpayer (and spouse) must have valid Social Security number.
• Valid Filing Status: Taxpayer cannot use Married Filing Separate filing status.
• Nonresident Alien Restriction: If taxpayer is considered a Nonresident Alien, taxpayer must use Married Filing Joint filing status.
• Requirement to Live in California: Taxpayer (and spouse) must have lived in California for at least half of the year. Although taxpayer (and spouse) are not required to establish California residency, the taxpayer (and spouse) must have lived in California for at least 183 days during the tax year. UltraTax defaults to using residency information entered via Client Properties and information entered on Screen CANRPY for determining the number of days the taxpayer and spouse lived in California. Use the fields Taxpayer lived in California for at least half of 2018 and Spouse lived in California for at least half of 2018 if the residency period does not match the period taxpayer and spouse lived in California.
• Form 2555 Restriction: Taxpayer’s federal return cannon include Form 2555 or Form 2555-EZ.
• Qualifying Child of Another Restriction: If taxpayer is not using MFJ status, taxpayer cannot be a qualifying child of another for EIC purposes. If applicable, enter data in the Taxpayer could be a qualifying child of another field.
• Investment Income Limitation: Investment income cannot exceed $3,699. Use the fields in the Investment Income section of this screen to change calculated values on the EIC - Investment Income Worksheet.

In addition, taxpayer with no qualifying children must meet the following criteria:

• Age Requirement: Taxpayer must be at least age 18 at the end of the tax year.
• Dependent of Another Restriction: If taxpayer is not using MFJ status, taxpayer cannot be claimed as a dependent on someone else’s tax return for the current tax year.

UltraTax CS uses information entered elsewhere to determine if taxpayer meets the aforementioned criteria. Enter 1 in this field to force all of the aforementioned criteria to be met on the EIC - Criteria to Qualify Worksheet or 2 to indicate that taxpayer does not qualify for the credit. An entry in this field suppresses the calculation and printing of the EIC - Criteria to Qualify Worksheet.

UltraTax CS determines whether or not the taxpayer and spouse lived in California for at least 183 days based on information entered via File > Client Properties and/or Screen CANRPY. If the actual time the taxpayer and spouse lived in California does not match the residency period, use these fields to force information reported on the EIC - Criteria to Qualify Worksheet.

Dependent information entered on federal Screen 1040 transfers to this statement dialog. The amount of California Earned Income Credit is based in part on the number of qualifying children. UltraTax/1040-CA defaults to identifying a dependent in this statement dialog as a qualifying child for the California Earned Income Tax Credit purposes if all of the following criteria are met

• Dependent has a valid Social Security Number.
• Dependent is under age 19, a student under the age of 24, or disabled.
• Relationship qualifies for EIC purposes.
• Dependent is not married.
• Dependent lived with the taxpayer in California for at least 183 days. If the Days lived w/ Tp column is left blank, UltraTax assumes 365 days if 12 is entered in the Months in Home column (Mos Home) in the Dependent information statement dialog on federal Screen 1040 or 183 days if 6, 7, 8, 9, 10, or 11 is entered at the federal level. Otherwise, UltraTax CS assumes that the child did not live with the taxpayer if this column is left blank at the California level.

Per instructions from California Franchise Tax Board, there are exceptions to some of the aforementioned criteria. If an exception applies, use the Force field to designate that a child qualifies or does not qualify for purposes of the Earned Income Tax Credit.

The number of qualifying children is used on the worksheets as a factor in determining eligibility for the Earned Income Credit as well as the amount of credit.

If the taxpayer’s filing status is not Married Filing Joint, the taxpayer cannot be a qualifying child (for EIC purposes) of another if claiming the California Earned Income Tax Credit. When calculating the EIC - Criteria to Qualify Worksheet, UltraTax CS assumes that the taxpayer is not a qualifying child of another. Enter 1 in this field if the taxpayer could be a qualifying child of another and is not using MFJ filing status. UltraTax CS will not calculate an amount for California Earned Income Tax Credit if 1 is entered in this field when the taxpayer is not using MFJ filing status.

If the Criteria to qualify (Force) field is blank, UltraTax CS prints the EIC - Criteria to Qualify Worksheet and, if applicable, the EIC - Investment Income Worksheet if taxpayer is claiming the California Earned Income Credit. Use this field to force or suppress printing of the worksheets.

If an address is entered on a unit of federal Screen C, select the applicable unit in order to automatically fill the Business information fields with data from that corresponding unit.