Dependency question

[HV Ken]

Just looking for confirmation or the response "what are you thinking??"....

TP and woman have child.

TP and woman are not married.

TP, woman, child all live in TP's home for entire year.

Woman makes zero income.

TP provides 100% support for woman and child.

Given above, woman (and child) can be claimed as dependent for TP.

[chuck]

I'd agree. Michigan has a law on the books I think that would not allow you to claim the mother of the child.

[Pacun]

I assume you want to file his federal taxes. The answer is: if child is his son/daughter, he will file as Head of House and will claim child as his son or daughter and mother as dependent using other as the relationship.

[mcb39]

Unless you are in a state where it is illegal to cohabitate, you can file your scenario for both Fed and State. HOH, Child and Other.

[michaelmars]

you have it correct Ken.

[jainen]

>>he will file as Head of House and will claim child as his son or daughter and mother as dependent using other as the relationship<<

In my opinion, the facts presented do not fully support this conclusion. First of all, the original post does not address filing status at all. We just don't know which parent pays the housing costs. We also don't know if the mother will claim the child as a dependent herself, perhaps for a non-tax purpose such as insurance or financial assistance.

We can begin with the assumption that no other relative lives in the home or that "Woman makes zero income" means she does not have any unearned income either, but in my opinion it is best to recognize that those are simply unsupported assumptions which still need to be resolved.

[Pacun]

>>he will file as Head of House and will claim child as his son or daughter and mother as dependent using other as the relationship<<

In my opinion, the facts presented do not fully support this conclusion. First of all, the original post does not address filing status at all. We just don't know which parent pays the housing costs. We also don't know if the mother will claim the child as a dependent herself, perhaps for a non-tax purpose such as insurance or financial assistance.

We can begin with the assumption that no other relative lives in the home or that "Woman makes zero income" means she does not have any unearned income either, but in my opinion it is best to recognize that those are simply unsupported assumptions which still need to be resolved.

KEN,

Based on what you said, I made an assumption AND based on what you said, Jainen made an assumption too. Please tell us who assumed the correct scenario. I assumed that if any of the adults were married, you would had mentioned it since you are not just a tax payer but a tax preparer. Am I correct in my assumption?

[HV Ken]

Thanks to all who have read and commented. I appreciate your time!

In regards to the recent discussion, I thought I was pretty clear on the scenario ("woman makes zero income" and "TP provides 100% support" - does that combination not communicate "which parent pays the housing costs" ?). jainen is correct I neglected to mention the HOH filing status, and that the mother who has zero income will not be filing a return to claim the child as her dependent. I can see from jainen's post how adding that information would be helpful. I can see how most of us, including myself, made certain assumptions, but jainen's questions/thoughts clarify those even further and remove ambiguity. Maybe I represent the minority, but I value reading jainen's responses on this board as I learn a lot from them.

[Pacun]

Thanks to all who have read and commented. I appreciate your time!

In regards to the recent discussion, I thought I was pretty clear on the scenario ("woman makes zero income" and "TP provides 100% support" - does that combination not communicate "which parent pays the housing costs" ?). jainen is correct I neglected to mention the HOH filing status, and that the mother who has zero income will not be filing a return to claim the child as her dependent. I can see from jainen's post how adding that information would be helpful. I can see how most of us, including myself, made certain assumptions, but jainen's questions/thoughts clarify those even further and remove ambiguity. Maybe I represent the minority, but I value reading jainen's responses on this board as I learn a lot from them.

I always appreciate Jainen comments. As I said before, I read every reply from him.

[jainen]

>>"woman makes zero income" and "TP provides 100% support" - does that combination not communicate "which parent pays the housing costs" ?<<

No, not at all. First of all, to my mind zero income says nothing about expenses. She could be using savings. And I wouldn't be surprised if "makes" zero income might not include unearned income, capital gains, an inherited IRA, or other elements of "taxable income," especially when the information comes directly from the client who is not familiar with technical jargon of the tax business.

Furthermore, support NEVER includes housing costs such as mortgage, insurance, taxes, and utilities. It only includes rental value. For example, if the father owned the house, he would be providing that support even if someone else were making the payments. And who better to share such expenses than the housemate? On the other hand, Head of Household counts ACTUAL costs, so in such a scenario the housemate might well pay more than half.

Why would they do that? Maybe the young family has cash flow problems beyond the father's earnings. Maybe he can't put the mother on his employer's group insurance, or it's cheaper to cover the child on her own private plan. Maybe he has income that he doesn't care to tell his ex-wife about, so he wants to match his expenses to his W-2. Maybe she plans to apply for a grant or some kind of assistance that looks at housing costs. Maybe they just think it's fair. Who knows?

There could even be a tax advantage. For example, if he is preparing for an offer in compromise, the father might need to stay within standard amounts. Maybe the CHILD has unearned income and they are avoiding kiddie tax based on the unmarried father not being the legal parent (e.g., the mother was previously married to someone else). Who knows?