can you get the earn income for kids if sister claims head of house?

If your friend's only income is the retirement pension she is not eligible to claim the EIC. The EIC requires EARNED income from a job or self-employment and retirement pensions are not earned income.

Her sister moving in has no affect on her taxes. Or her sister's taxes for that matter. The sister cannot claim the kids since the kids did not live in the sister's home for more than half of the year. Since the sister cannot claim the kids, she cannot claim the EIC. The sister cannot file as Head of Household since she did not pay more than half of the cost of maintaining the home for the entire year AND because she does not have a qualifying dependent for HoH filing status purposes.

Retirement pensions are not based upon need or family size. They are either a defined benefit plan or a defined contribution plan but neither of those depend upon financial need or family size.

No she can't get EIC because the kids must have lived with her sister for more than half of the year to be qualifying children for her and you said she just moved in. There is no question she can't get EIC for the other sister since she is probably too old to be a qualifying child earning retirement and also they didn't live together for more than half the year.

I am assuming you are asking if the sister that has moved in that has earned income can claim the kids and sister for EIC.

The sister can only file HofH if she provides over half of the cost of the household, unlikely if she just moved in recently unless she's been providing support for the kids and your friend all year. And no she didn't live with them for 6 months, so she can't claim any of them. And no, no EIC.

The sis most likely can't claim your friend anyway, since she gets retirement pay.

Assuming she meets the requirements, sure. EIC tops out at three dependents anyway.

But she doesn't meet the requirements since she just moved in last month. Kids had to live with her at least half the year. Can't file HoH either, as she didn't provide over 50% of the expenses of the household for the year.

Your friend's sister cannot claim EIC for her nieces/nephews because she has not lived with them for more than six months.

Your friend's sister cannot claim the nieces/nephews as dependents because the mother lives with them, and the children are her qualifying children. Therefore, your friend cannot file as Head of Household. This is true even if your friend supported the children and paid most of the household expenses in 2013.

if this is referring to the sister who works claiming the children on her tax return and EIC, no

it is obviously NOT the household of the sister since she just moved in she has not provided the requirements to be able to claim the children as her dependents

Retirement income isn't EARNED INCOME.

Your friend may lose some of her pension check because another person who works is living in the house.

The reason being, is that more money is now coming into the house, so your friend will lose some.

Her pension is based on her and her children only. No one else can move in.