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An HR Glossary for HR Terms

Glossary of Human Resources Management and Employee Benefit Terms

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Advanced Earned Income Credit

What is Advanced Earned Income Credit?

An Advanced Earned Income Credit is the early bestowal of the Earned Income Tax Credit (EIC) through the completion of Form W-5.

Eligible employees can receive the earned income tax credit (EIC) when they file their tax return. Or, by completing Form W-5, Earned Income Credit Advance Payment Certificate, they can get a portion of the credit in advance with their pay. Form W-5 expires on December 31 of each year. A new form must be filed each year in order to continue receiving advance EIC in the next year.

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