How do I fill out the EIC worksheet? (long warm up question)

[Pacun]

Unmarried couple moves to her parents and lives under the same roof the whole year with their five children ages (by Dec 31, 2012) 19, 16, 13, 10 and 7. There were no sleepovers or vacations so all of them slept 365 nights at this house.

Parents of the mother are married (ages 68 and 69) and had earned income of 30K of which half was arned by each. They entered the workforce 5 years ago and had no other income.

The mother earned $15K

The father earned $28K

The 19 year old child went to school half time and earned 8K and didn't provide more than 50% of his own support.

All of them are US citizens with valid SS numbers and lived in the US the whole year.

They decided to claim the children this way:

Parents of the mother will claim the 7.

The mother will claim the 10 year old.

The father will claim 13 year old.

The 19 year old child will claim his 16 year old sibling.

It seems that all 1040 forms will include EIC.

The children ages 16,13,10 and 7 are qualifying relatives for all of the taxpayers so each EIC worksheet will have "yes" checked.

So how do I answer the following question: "Relationship to the other person": Do I say "bother or sister" to each and all of them or I type "Son or Daughter".

How will you answer the question the next question for the 19 year old or grandparents "will you win the tie breaker?"

Extra point: If no other income or economic benefit got into this household, (all of them helped to pay the rent of this house) can anyone file as HOH and how to document it?

[grandmabee]

grandparents can't claim HOH if they are married.

[kcjenkins]

Tie-breaker rule only applies if two people who COULD claim the child do not AGREE on which will claim the child.

If two or more persons have the same qualifying child for EITC, dependency exemption, child tax credit, head of household filing status, or credit for child and dependent care expenses, only one person can claim the child as a qualifying child for all these benefits. Person claiming child other than parent must have a higher Adjusted Gross Income (AGI) than parent.

Otherwise, you must decide who will claim the benefits, including EITC, using that qualifying child. If you cannot agree, and more than one person uses the same child, the tiebreaker rules apply.