Intuit Academy Tax Practice Exam

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Enhance your tax preparation skills with the Intuit Academy Tax Exam. Study with comprehensive quizzes and detailed explanations. Prepare for success today!

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What amount will Liz receive as a refund from the Earned Income Tax Credit?

$1,200
$750
$200
$0

The correct answer is: $750

To determine the correct refund amount from the Earned Income Tax Credit (EITC) for Liz, it's important to consider her eligibility based on her earned income, filing status, and the number of qualifying children she may have. The EITC is designed to benefit low to moderate-income individuals and families, providing a refundable tax credit that can significantly reduce their tax liability and potentially result in a refund. If Liz qualifies for the EITC based on her income and meets the necessary requirements, it is plausible that she could receive a refund of $750. This amount suggests that her earned income and tax circumstances align within the income thresholds established for the EITC, which can vary yearly. The amount of EITC can be influenced by various factors, including income levels and the presence of dependent children; higher refunds are typically available for taxpayers with children. In Liz's case, the calculated refund of $750 indicates that her qualifying conditions for the EITC were met, making it the valid refund amount for the scenario presented.