Reference no: EM133258363

Donlad Bauta, who is homeless, listed in his tax return in 2019 his occupation as a beggar. During the year at issue, Mr. Bauta did not otherwise earn any income working for anyone. Nonetheless, Mr. Bauta reported income from begging in the amount of $3,000 in his 2019 Federal income tax return and claimed an earned income credit, in the amount of $550. Based on that credit, Mr. Bauta claimed a refund in the amount of $550. The IRS denied his claim arguing that the funds he collected while begging are not earned income, and since the credit is available only to individuals with earned income Mr. Bauta is ineligible for the earned income credit. Is he entitled to receive a refund?