Form W-5 Earned Income Credit Advance Payment Certificate

2010 Form W-5
Earned Income Credit Advance Payment Certificate
Purpose:

This is the first circulated draft of the 2010 Form W-5 for your
review and comments.

TPCC Meeting:

None, but may be arranged if requested.

Prior Version:

The 2009 Form W-5 can be viewed by clicking on the following
link:
http://www.irs.gov/pub/irs-pdf/fw5.pdf

Other Products:

Circulations of draft tax forms, instructions, notices, and
publications are posted at:
http://taxforms.web.irs.gov/Circulations/index.htm
Please email, fax, call, or mail any comments by September 14,
2009. Comments submitted by telephone must be followed up in
writing to be considered. Send a copy of any email comments to
the form’s reviewer, Karl Blake, at [email protected].

Comments:

Robert G. Black
Tax Law Specialist
Tax Forms and Publications
SE:W:CAR:MP:T:I:P

Email: [email protected]
Phone: (202) 283-6634
Fax:
(202) 283-0001

Explanation of Major Changes to Form W-5
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We updated the years as appropriate.
The definition of earned income on page one, column two, was
changed to show nontaxable combat pay can be included in earned
income if elected. P.L. 110-245, section 102(a).
Line 3 on page 2 was changed to add the category “3 or more
qualifying children” and income limit amounts. Per P.L. 111-5,
section 1002.
Amounts that will be changed as a result of cost of living increases
are temporarily replaced with “Xs”.
Item 2 under "Who is a Qualifying Child" on page 3 was changed to
show that a qualifying child must be younger than the taxpayer
unless permanently and totally disabled.
Item 4 was added under “Who Is a Qualifying Child” on page 3 to tell
the taxpayer in order for a married child to be a qualifying child that
married child can not file a joint return unless the return was filed
only to claim a refund.
"Qualifying child of more than one person" on page 3 is modified to
reflect the new definition of qualifying child in P.L. 110-351, section
501.

Version A, Cycle 1

2010 Form W-5
Instructions
Purpose of Form
Use Form W-5 if you are eligible to get part of the earned income
credit (EIC) in advance with your pay and choose to do so. See Who
Is Eligible To Get Advance EIC Payments? below. The amount you
can get in advance generally depends on your wages. If you are
married, the amount of your advance EIC payments also depends
on whether your spouse has filed a Form W-5 with his or her
employer. However, your employer cannot give you more than
$X,XXX throughout 2010 with your pay. You will get the rest of any
EIC you are entitled to when you file your tax return and claim the
EIC.
If you do not choose to get advance payments, you can still
claim the EIC on your 2010 tax return.

What Is the EIC?

institutions are paid for their work or amounts received as a pension
or annuity from a nonqualified deferred compensation plan or a
nongovernmental section 457 plan. Generally, earned income does
not include nontaxable earned income, but you can elect to include
nontaxable combat pay in earned income.
4. You expect to be able to claim the EIC for 2010. To find out if
you may be able to claim the EIC, answer the questions on page 2.

How To Get Advance EIC Payments
If you are eligible to get advance EIC payments, fill in the 2010
Form W-5 at the bottom of this page. Then, detach it and give it to
your employer. If you get advance payments, you must file a 2010
Form 1040 or 1040A income tax return.
You may have only one Form W-5 in effect at one time. If you and
your spouse are both employed, you should file separate Forms
W-5.
This Form W-5 expires on December 31, 2010. If you are eligible
to get advance EIC payments for 2011, you must file a new Form
W-5 next year.

DRAFT AS OF
August 5, 2009

The EIC is a credit for certain workers. It reduces the tax you owe.
It may give you a refund even if you do not owe any tax.

You may be able to get a larger credit when you file your
2010 return. For details, see Additional Credit on page 3.

Who Is Eligible To Get Advance EIC
Payments?

You are eligible to get advance EIC payments if all four of the
following apply.
1. You (and your spouse, if filing a joint return) have a valid social
security number (SSN) issued by the Social Security Administration.
For more information on valid SSNs, see Pub. 596, Earned Income
Credit (EIC).
2. You expect to have at least one qualifying child and to be able
to claim the credit using that child. If you do not expect to have a
qualifying child, you may still be eligible for the EIC, but you cannot
receive advance EIC payments. See Who Is a Qualifying Child?
beginning on this page.
3. You expect that your 2010 earned income and adjusted gross
income (AGI) will each be less than $XX,XXX ($XX,XXX if you expect
to file a joint return for 2010). Include your spouse’s income if you
plan to file a joint return. As used on this form, earned income does
not include amounts inmates in penal

Who Is a Qualifying Child?

A qualifying child is any child who meets all four of the following
conditions.
1. The child is your son, daughter, stepchild, foster child, brother,
sister, half brother, half sister, stepbrother, stepsister, or a
descendant of any of them (for example, your grandchild, niece, or
nephew). An adopted child is always treated as your own child. An
adopted child includes a child lawfully placed with you for legal
adoption. A foster child is any child placed with you by an
authorized placement agency or by judgment, decree, or other
order of any court of competent jurisdiction.
(continued on page 3)





Give the bottom part to your employer; keep the top part for your records.
Detach here

Form

W-5

Department of the Treasury
Internal Revenue Service
Print or type your full name

Earned Income Credit Advance Payment Certificate

OMB No. 1545-0074

 Use

the current year's certificate only.
 Give this certificate to your employer.
 This certificate expires on December 31, 2010.

2010
Your social security number

Note. If you get advance payments of the earned income credit for 2010, you must file a 2010 federal income tax return. To get
advance payments, you must have a qualifying child and your filing status must be any status except married filing a separate return.
1
2
3

I expect to have a qualifying child and be able to claim the earned income credit for 2010 using that child. I do
not have another Form W-5 in effect with any other current employer, and I choose to get advance EIC payments
Check the box that shows your expected filing status for 2010:
Single, head of household, or qualifying widow(er)
Married filing jointly
If you are married, does your spouse have a Form W-5 in effect for 2010 with any employer? . . . . .

Under penalties of perjury, I declare that the information I have furnished above is, to the best of my knowledge, true, correct, and complete.

Signature



Date
Cat. No. 10227P



Yes

No

Yes

No

Version A, Cycle 1
Page 2

Form W-5 (2010)

Questions To See if You May Be Able To Claim the EIC for 2010
You cannot claim the EIC if you file either Form 2555 or Form 2555-EZ (relating to foreign earned income) for 2010. You also
cannot claim the EIC if you are a nonresident alien for any part of 2010 unless you are married to a U.S. citizen or resident, file
a joint return, and elect to be taxed as a resident alien for all of 2010.
1

Do you expect to have a qualifying child? Read Who Is a Qualifying Child? that starts on page 1 before you answer this
question. If the child is married, be sure you also read Married child on page 3.
You may be able to claim the EIC but you cannot get advance EIC payments.
No.
Yes. Continue.
If the child meets the conditions to be a qualifying child for both you and another person, see Qualifying child of more
than one person on page 3.

2

Do you expect your 2010 filing status to be married filing a separate return?
You cannot claim the EIC.
Yes.
No. Continue.

DRAFT AS OF
August 5, 2009

If you expect to file a joint return for 2010, include your spouse’s income when answering questions 3 and 4.
3

Do you expect that your 2010 earned income and AGI will each be less than: $XX,XXX ($XX,XXX if married filing jointly) if you
expect to have 1 qualifying child; $XX,XXX ($XX,XXX if married filing jointly) if you expect to have 2 qualifying children; or
$XX,XXX ($XX,XXX if married filing jointly) if you expect to have 3 or more qualifying children?
You cannot claim the EIC.
No.
Yes. Continue. But remember, you cannot get advance EIC payments if you expect your 2010 earned income or AGI will
be $XX,XXX or more ($XX,XXX or more if married filing jointly).

4

Do you expect that your 2010 investment income will be more than $X,XXX? For most people, investment income is the total of
their taxable interest, ordinary dividends, capital gain distributions, and tax-exempt interest. However, if you plan to file a 2010
Form 1040, see the 2009 Form 1040 instructions to figure your investment income.
You cannot claim the EIC.
Yes.
No. Continue.

5

Do you expect that you, or your spouse if filing a joint return, will be a qualifying child of another person for 2010?
Yes. You cannot claim the EIC.
No. You may be able to claim the EIC.

Version A, Cycle 1
Page 3

Form W-5 (2010)

2. The child is under age 19 at the end of 2010 and younger than
you; or under age 24 at the end of 2010, a student, and younger
than you; or any age and permanently and totally disabled. A
student is a child who during any 5 months of 2010 (a) was enrolled
as a full-time student at a school or (b) took a full-time, on-farm
training course given by a school or a state, county, or local
government agency. A school includes a technical, trade, or
mechanical school. It does not include an on-the-job training
course, correspondence school, or Internet school.
3. The child lives with you in the United States for over half of
2010. But you do not have to meet this condition if (a) the child was
born or died during the year and your home was this child’s home
for the entire time he or she was alive in 2010,or (b) the child is
presumed by law enforcement authorities to have been kidnapped
by someone who is not a family member and the child lived with
you for over half of the part of the year before he or she was
kidnapped. Also, temporary absences, such as for school, vacation,
medical care, or detention in a juvenile facility, count as time the
child lived with you. Members of the military on extended active
duty outside the United States are considered to be living in the
United States.
4. The child does not file a joint return for 2010 (or files a joint
return for 2010 only to get a refund of withheld income tax).
Married child. A child who is married at the end of 2010 is a
qualifying child only if:
1. You can claim him or her as your dependent, or
2. You are the custodial parent and would be able to claim the
child as your dependent, but the noncustodial parent claims the
child as a dependent because:
a. You signed Form 8332, Release of Claim to Exemption for
Child of Divorced or Separated Parents, or a similar statement,
agreeing not to claim the child for 2010, or
b. You have a pre-1985 divorce decree or separation agreement
that allows the noncustodial parent to claim the child and he or she
gives at least $600 for the child’s support in 2010.
Other rules may apply. See Pub. 501, Exemptions, Standard
Deduction, and Filing Information, for more information on children
of divorced or separated parents.
Qualifying child of more than one person. If the child meets the
conditions to be a qualifying child of more than one person, only
one of those persons can treat that child as a qualifying child for
2010 and take, if otherwise eligible, all of the following tax benefits
using that child: the child’s dependency exemption, the child tax
credit, head of household filing status, the credit for child and
dependent care expenses, the exclusion for dependent care
benefits, and the EIC. The other person cannot take any of these six
tax benefits unless he or she has a different qualifying child. To
determine which person can treat the child as a qualifying child, the
following rules apply.

all live together and your child's other parent does not live with you,
you can treat your child as a qualifying child, or you can choose to
let your mother do so if her AGI is higher than yours. For details,
more examples, and a special rule for divorced or separated
parents, see Pub. 596.
Caution. A qualifying child whom you use to claim the
EIC must have a valid social security number unless he
or she is born and dies in 2010.

What if My Situation Changes?
If your situation changes after you give Form W-5 to your employer,
you will probably need to file a new Form W-5. For example, you
must file a new Form W-5 if any of the following applies for 2010.
● You no longer expect to have a qualifying child. Check “No” on
line 1 of your new Form W-5.
● You no longer expect to be able to claim the EIC for 2010. Check
“No” on line 1 of your new Form W-5.

DRAFT AS OF
August 5, 2009

● If only one of the persons is the child's parent, the child is treated
as the qualifying child of the parent.
● If the parents do not file a joint return together but both parents
claim the child as a qualifying child, the IRS will treat the child as
the qualifying child of the parent with whom the child lives for the
longer period of time in 2010. If the child lives with each parent for
the same amount of time, the IRS will treat the child as the
qualifying child of the parent who has the higher AGI for 2010.
● If no parent can claim the child as a qualifying child, the child is
treated as the qualifying child of the person who has the highest
AGI for 2010.
● If a parent can claim the child as a qualifying child but no parent
does so claim the child, the child is treated as the qualifying child
of the person who has the highest AGI for 2010, but only if that
person's AGI is higher than the AGI of any of the child's parents.
Subject to the rules just described, you and the other person(s)
may be able to choose which of you treats the child as a qualifying
child. For example, if you, your 3-year-old child, and your mother

● You no longer want advance payments. Check “No” on line 1 of
your new Form W-5.
● Your spouse files Form W-5 with his or her employer. Check
“Yes” on line 3 of your new Form W-5.

Note. If you get advance EIC payments and find you are not
eligible for the EIC, you must pay back these payments when you
file your 2010 federal income tax return.

Additional Information
How To Claim the EIC

If you are eligible, claim the EIC on your 2010 tax return. See your
2010 tax return instruction booklet.

Additional Credit
You may be able to claim a larger credit when you file your 2010
Form 1040 or Form 1040A because your employer cannot give you
more than $X,XXX throughout the year with your pay. You may also
be able to claim a larger credit if you have more than one qualifying
child. But you must file your 2010 tax return to claim any additional
credit.
Privacy Act and Paperwork Reduction Act Notice. We ask for
the information on this form to carry out the Internal Revenue laws
of the United States. Internal Revenue Code sections 3507 and
6109 and their regulations require you to provide the information
requested on Form W-5 and to give it to your employer if you want
advance payment of the EIC. As provided by law, we may give the
information to the Department of Justice and other federal
agencies. In addition, we may give it to cities, states, and the
District of Columbia so they may carry out their tax laws. We may
also disclose this information to other countries under a tax treaty,
to federal and state agencies to enforce federal nontax criminal
laws, or to federal law enforcement and intelligence agencies to
combat terrorism. Failure to provide the requested information may
prevent your employer from processing this form; providing false
information may subject you to penalties.
You are not required to provide the information requested on a
form that is subject to the Paperwork Reduction Act unless the form
displays a valid OMB control number. Books or records relating to a
form or its instructions must be retained as long as their contents
may become material in the administration of any Internal Revenue
law. Generally, tax returns and return information are confidential,
as required by Code section 6103.
The average time and expenses required to complete and file this
form will vary depending on individual circumstances. For the
estimated averages, see the instructions for your income tax return.
If you have suggestions for making this form simpler, we would
be happy to hear from you. See the instructions for your income tax
return.