Margaret CPA in OH Posted February 3, 2014 Report Share Posted February 3, 2014 Finally I have a client which qualifies-with a wrinkle I don't know how to smooth.Twin children of single dad turned 19 Dec. 18, 2013. Daughter is full time student so clearly a dependent. Son is not a student but has struggled with work as has dad, self-employed. I don't have dad's income figures yet but he has struggled financially to the point of putting house on the market for short sale or foreclosure and is living with kids in a friend's house.Son does not meet all the criteria to be dependent as his income was $5000. However, for EITC the rules state that support test does not apply. With this, I am not sure how to file son's return - dependent or not? - or dad's return when I get his figures. Son wants his refund yesterday but not sure what his status is.He will receive full federal and state refunds no matter but could make a big difference for dad. Just wait until dad gets it all to me? What is the answer if dad qualifies with less than $43,000 AGI?Sigh, and I was hoping to avoid this for another year. Not to be. Quote Link to comment Share on other sites More sharing options...
Pacun Posted February 3, 2014 Report Share Posted February 3, 2014 Dad will not qualify for EIC because he made $43K and he only has one child that qualifies for EIC. His son needs to file himself and father and the other child need to file as HH and claim EIC if he does make too much money. $43K is too much money for a parent with only one child. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted February 3, 2014 Author Report Share Posted February 3, 2014 Thanks, Pacun, for the quick reply. I know dad makes too much at $43,000 for one child, however not for 2 children. My question relates to the part of Qualifying child criteria that says the support test does not apply. Does dad lose out because son is 13 days over 19 even though dad provides more than 50% of son's support? The age test is the breaking test here, right?They will be so unhappy to lose out for 13 days of age but it is what it is, sadly.Thanks again. Quote Link to comment Share on other sites More sharing options...
mcb39 Posted February 3, 2014 Report Share Posted February 3, 2014 The son has too much income to be the father's dependent. Therefore, no EIC either. There always has to be a cutoff somewhere. I, personally, think that $3900 is way too low. Who can live for a year on that amount. I have had clients who have missed the dependent eligibility by $10 or $20.Being SE, has the dad paid in estimates? Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted February 3, 2014 Author Report Share Posted February 3, 2014 The income is what raised the question - the details say that 'the support test does not apply' for qualifying children but doesn't explain if there is no limit upper or lower. I know that $5000 is greater than the listed $3900 limit but 'does not apply' is pretty vague to me. I guess that the age is the determining factor and it's sad that it is less than 2 weeks. Yes, cutoffs have to be somewhere.Estimated payments for dad? Well, I always provide vouchers based on projected income but, until last week, had no idea of his dire straits. My guess is no payments were made as he was trying to save the house. At least he was there long enough for the kids to graduate from a really good school system and the daughter is doing very well in college on all scholarships. Son, not so much and had issues at birth. They are adopted and were crack babies raised by a single dad. What a guy! Quote Link to comment Share on other sites More sharing options...
Mr. Pencil Posted February 3, 2014 Report Share Posted February 3, 2014 At least he was there long enough for the kids to graduate from a really good school system When did they graduate? It must have been a REALLY good school if a December crack baby with birth defects from a low income single-parent family graduated at age 17. Quote Link to comment Share on other sites More sharing options...
Lion EA Posted February 3, 2014 Report Share Posted February 3, 2014 The support test refers to how much support was provided by who and, as you say, is not a factor for EIC. However, being a qualifying child IS a factor and QC has an age limit. Are you confusing this with qualifying relative where an older child could still be a QR if they don't earn too much? Quote Link to comment Share on other sites More sharing options...
Lion EA Posted February 3, 2014 Report Share Posted February 3, 2014 When did they graduate? It must have been a REALLY good school if a December crack baby with birth defects from a low income single-parent family graduated at age 17. OP doesn't say if son was in school at 17 or 18 but did say he's not a student now that he's 19. (My son was a bad student, but graduated at 17 as did my stepdaughter and I and most kids with birthdays after June. My mother skipped a grade and graduated at 16.) Are you asking if the son was a full-time student for any part of five months during 2013? Quote Link to comment Share on other sites More sharing options...
mcb39 Posted February 3, 2014 Report Share Posted February 3, 2014 OP doesn't say if son was in school at 17 or 18 but did say he's not a student now that he's 19. (My son was a bad student, but graduated at 17 as did my stepdaughter and I and most kids with birthdays after June. My mother skipped a grade and graduated at 16.) Are you asking if the son was a full-time student for any part of five months during 2013?These are really good questions, because if the son didn't graduate until June, 2013, he would qualify under the full-time student rules and be an eligible dependent. My Granddaughter graduated in June and turned 19 in October so was considered a full-time student for that year. I know this is grasping at straws, but we need to cover all of the possibilities. 1 Quote Link to comment Share on other sites More sharing options...
Pacun Posted February 3, 2014 Report Share Posted February 3, 2014 These are really good questions, because if the son didn't graduate until June, 2013, he would qualify under the full-time student rules and be an eligible dependent. My Granddaughter graduated in June and turned 19 in October so was considered a full-time student for that year. I know this is grasping at straws, but we need to cover all of the possibilities. You are right, but since Margaret said that he is not in school, I am pretty sure she already asked AND also, she knows that as long as he was a student from Jan to May, the father would be able to claim him as long as he didn't provide more than 50% of his own support. If you notice, the question is ONLY about EIC, which means that Margaret knows that father cannot claim the child. Margaret, I think this will help you better remember where you are confused. My brother has two children who live with their mother. Last year, the mother (by court order) gave the exemptions to my brother. So the children will be claimed by my brother but the mother will get EIC because the children lived with her. So, she earned 15K and 60K from my brothers child support, she will file as single with no dependents and she will get about 8K of EIC from the IRS and State. NOT BAD for her, correct? Quote Link to comment Share on other sites More sharing options...
Mr. Pencil Posted February 3, 2014 Report Share Posted February 3, 2014 My son was a bad student, but graduated at 17 as did my stepdaughter and I and most kids with birthdays after June. In your state of CT children are eligible for kindergarten in the year they turn five. In Ohio, the cutoff is September birthdays. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted February 3, 2014 Author Report Share Posted February 3, 2014 Thanks so much, all, for chiming in with this. Frankly, I forgot which year they graduated and it was June, 2013. I had prepared a return in 2013 for the son's 2012 income, all of $369, and didn't recall whether the daughter had been in college since fall 2012 or 2013.Now I only have to get the dad's income to see whether his situation is as grim as I hope it is not. If it is below that $43,000, then it appears that he is eligible to file with 2 dependents (son's $5000 does not apply for support) as both were in school at least 5 months of the year. They were 18 at graduation.Mr. Pencil, it was a very good school system and the dad was not always low income. In the early years he was employed at a large firm making a very good 6 figure income but was downsized about 6 years ago. He continued doing well as a consultant (training on certain software) until recently. In 2012 his Sch C was $70,000, the lowest in a while. The kids had great assistance when babies and toddlers through the programs that facilitated the adoption. Dad is pretty smart and has a wide circle of educated supportive friends who helped raise the kids. They moved to the community with great schools just for the extra help available and it paid off with the daughter. I think the son is just more interested in non-academic pursuits and maybe is a bit slower maturing. Many kids, maybe more boys than girls, take more time than others. My son was in high school at 10 but decided his own path and is only now, at 33 finishing his degree in engineering. Diff'rent strokes (but made his father and me crazy all these years as we both have master's degrees and he did not value education!). Quote Link to comment Share on other sites More sharing options...
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