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Looks like the verbiage for support test, and the residency time was changed, possibly in 2005. Better news for foster parents. Our first foster arrived in 88… foster failed twice . Stopped actively fostering after 20 years, but we will still do respite in special cases.

The 2017 regs also clarify that government payments to an individual used for support of that individual is support provided by a third party, not support by that individual. (The exception to this is Social Security benefits which are treated as support by the beneficiary.) Also, government payments used by the recipient to support another individual is support by the recipient, not support by a third party. In other words, government payments to the child are support by a third party, and government payments to the foster parent, if used to support the child, are support by the foster parent. The support requirement for a qualifying child is simply that the child not provide more than half of their own support - it is unlikely that they do unless the child is receiving Social Security survivor or disability benefits. See https://www.federalregister.gov/d/2017-01056/p-338

This became a necessity in recent years, so I'm very glad to see it.

You figured out the proper handling of the prepaid MD tax due to sale of the former home. What I think you may thinking of incorrectly is that the care facility is considered temporary, that this home was still the client's permanent residence, or that he is a MD resident. Temporary absences of short duration for rehab or recovery of illness is one thing, but a close to six-year stay probably isn't temporary. If the physical or mental medical issues are such that these won't get better and client moved to the care facility with no intention of ever returning to his home, I don't see how you can file the way you described below. .

You just treat it as any withholding and claim it on the return. This is to force non-residents to file returns when they have income within the state. Many states are also doing this for K-1 income.

IRS just cancelled an assessment against me that also when to collection - From 2014! 8 years of letters. You can just tell the collection agency in writing that you want to deal directly with the IRS on the issue and they are required to send it back to them and cancel their contact with you.

Payments from the state are not considered as support from the child, so they do not enter into the calculation for the support test. As long as the child does not provide over half their support, the foster parents can claim them as a dependent, as long as all the other criteria are met. From IRS Pub 501 Example 2. You provided $3,000 toward your 10-year-old foster child's support for the year. The state government provided $4,000, which is considered support provided by the state, not by the child. See Support provided by the state (welfare, food benefits, housing, etc.), later. Your foster child didn't provide more than half of her own support for the year.

Might be a sign of identity theft?

A slight correction. The portion of the proposed regs I quoted have to do with qualification for head of household. The section dealing with qualification for dependency is later in section 1.152-4(d)(2): https://www.federalregister.gov/d/2017-01056/p-365

There is no requirement that the foster child live with them 6 months if they were placed later in the year. From Pub 501 https://www.irs.gov/publications/p501#en_US_2021_publink100091910 This was clarified in the 2017 proposed regulations on dependency section 1.2-2(c)(4) https://www.federalregister.gov/documents/2017/01/19/2017-01056/definition-of-dependent

Here's the link for all the related MD forms. In the future, you can prevent/reduce the withholding if you can file the correct form about a month before settlement. Also, you can request a refund if you don't want to wait until you file the tax return for that year.

Sounds like a good question for Drake's support line because, while we have some Drake users here, we may not have anyone here that routinely prepares Oklahoma returns and with knowledge of your specific multi-state issue within the Drake program.