If you are disabled and applying for Social Security Disability do not be lured into filing for an illegitimate EITC (earned income tax credit); it is a criminal act that could very well be caught by the IRS and will damage your SSDI claim as well.  This is explained below by Tracey Cahn, Esq. who is a member of my disability law firm of Kazmierczak & Kazmierczak, LLP.

The earned income tax credit, or EITC, offers a tax refund for low wage workers.  It is so generously written, a worker with no tax liability can get a refund.  However, if you are disabled, and have not actually earned income, STAY AWAY FROM IT.
 
Over the last 10 years that I have been practicing Social Security disability law, I have run into three brick walls caused by the EITC being used illegitimately.  All three of the claimants involved were extremely poor, and had been on welfare and like services for years.  Each of the three had a “friend/tax professional” prepare their taxes.  In each case, the “friend/tax professional” had advised the claimant to take advantage of the EITC; and each claimant signed a tax return reflecting income of $3,000 to $7,000.
 
I will explain what happened in one such case.  Because the ALJ had only just obtained a recent run of her earnings, I had no advance warning that her tax record reflected an additional $6,000 in self-employment income, after expenses.
 
The judge asked my claimant about her earnings in 2010.  She stated what I knew to be the truth; after her medical condition had kept her out of work for eight (8) months, she made an unsuccessful work attempt.  She began working in July 2010 and within two (2) months, she suffered a seizure and heart failure, and has not worked since.
 
The Judge acknowledged this but then went on to ask about her self-employment income.  She denied having any.  The Judge asked her about the $6,000 stated to be earned as self-employment.  She said that that was a mistake; she never earned that money.  The Judge said he had gotten this information from the IRS, and asked whether that income was reflected on her 2010 tax return.  She then stated that the tax return had been prepared by her “friend”, a new tax professional, and she had told her to sign the return because she would get money back.  The Judge was stuck, and the claimant and I were stuck.
 
My argument to the judge was going to be that the claimant’s summer 2010 work should be considered a failed work attempt, and she should be found disabled as of her alleged onset date in November of 2009.  Based on her medical records, and her actual work experience, this was a reasonable argument.  However, this “$6,000” is now throwing a monkey wrench into it.  The claimant’s credibility is tainted by this bad act.
 
As it is, I have spoken with the Judge at length.  He is a merciful fellow and I believe he will support a favorable finding, but instead of November of 2009, he may well only grant benefits as of the end of August 2010.  Thus, her hope of getting a $2,000 refund, likely has cost her 10 months of Social Security benefits.  She never did receive the “refund” and even if she had, the loss of 10 months of Social Security disability benefits is worth far more than the anticipated refund.  Before following advice from a “friend/tax professional” on getting an EITC consider the possibility of criminal charges for fraudulent statements to the IRS and the affect it will have on your credibility in a Social Security Disability claim.