Dependent Dispute

[Philip1117]

Uncle had 5 year old great nephew in his care from 1/1/2007 to 12/10/2007. Uncle recieved no support from childs mother or father for the entire year. Childs mother plans to claim child on her tax return. Mother and father signed an agreeemnt at the begining of 2007 stating Uncle was entitled to claim the child.

If she files first how do you challenge her filing since the uncle had the child for 11+ months and paid all cost to support the child.

Thanks

Phil

[jainen]

>>how do you challenge her filing<<

I'm assuming the uncle is your client, and if so I'm not sure how you know what the mother will do. You are considering a number of things that are, frankly, irrelevant. The agreement is probably unenforceable since someone can not legally avoid parental responsibilities that way; at any rate, it has no effect whatsoever on federal tax law. If "in his care" means they lived together, then the boy is the uncle's qualifying child. Support is not a factor. Not a factor. If the mother did not also live with the child for at least six months she is not eligible to claim a dependent, but if she DID live with the child the tie breaker rules will allow it. Support is not a factor, so I don't understand why you mention it multiple times.

Regardless of who "files first," if the same SSN shows up on two returns both taxpayers will get a letter from the IRS asking for an explanation, which should be simple enough to answer.

[Philip1117]

>>how do you challenge her filing<<

I'm assuming the uncle is your client, and if so I'm not sure how you know what the mother will do. You are considering a number of things that are, frankly, irrelevant. The agreement is probably unenforceable since someone can not legally avoid parental responsibilities that way; at any rate, it has no effect whatsoever on federal tax law. If "in his care" means they lived together, then the boy is the uncle's qualifying child. Support is not a factor. Not a factor. If the mother did not also live with the child for at least six months she is not eligible to claim a dependent, but if she DID live with the child the tie breaker rules will allow it. Support is not a factor, so I don't understand why you mention it multiple times.

Regardless of who "files first," if the same SSN shows up on two returns both taxpayers will get a letter from the IRS asking for an explanation, which should be simple enough to answer.

I mention support several times since I thought it was important. Thanks for letting me know its not. My practice is focused on Seniors 60+ so I don't keep up on the dependent rules since it doesn't come up much.

[jainen]

>>My practice is focused on Seniors 60+<<

I don't want to mislead you, so I will say support CAN be important for seniors. The definition of qualifying child has no age limit if the dependent is permanently disabled. Therefore a taxpayer who lives with a disabled sister may have a qualifying child--unless the disabled sibling provides more than half of her own support, like from Social Security. A senior who takes care of a grandchild for six months may also have a qualifying child, even if a parent or welfare is paying the bills. You should catch up with these new rules. (The rules for claiming a non-relative as a dependent haven't changed.)

[Jesse]

>>how do you challenge her filing<<

Regardless of who "files first," if the same SSN shows up on two returns both taxpayers will get a letter from the IRS asking for an explanation, which should be simple enough to answer.

Simple enough to answer but what are some examples of actual proof that the child was physically in the home? I have a similar case where grandparents have a teenager, how can thay prove that this child was physically in their home from mid February until late Novemeber?

[Eli]

Simple enough to answer but what are some examples of actual proof that the child was physically in the home? I have a similar case where grandparents have a teenager, how can thay prove that this child was physically in their home from mid February until late Novemeber?

School records showing the the address for the child & the grandparents. Doctor records showing the same. It's important these items get taken care of when the child moves in or as soon as possible thereafter.

Eli

[jainen]

>>grandparents have a teenager, how can they prove that this child was physically in their home<<

Telephone bills?

[Eli]

>>grandparents have a teenager, how can they prove that this child was physically in their home<<

Telephone bills?

Good one, Jainen!!

[jainen]

>>Good one, Jainen!!<<

Thank you! I thought it was the best one, but here are my other choices.

Prescription label from the bottle of ritalin.

Traffic ticket for driving with feet outside the car.

Mailing label for Mad Magazine subscription.

[RoyDaleOne]

Is this not the rule?

"For 2005 and later years, a taxpayer can claim a qualifying relative (an individual other than a spouse or qualifying child) as a dependent only if all of the following tests are met: (1) the support test, (2) the relationship test, (3) the citizenship test, (4) the gross income test, and (5) the joint return test. "

[rickart]

We have a client with a similar problem (though it's TP and Ex-Spouse in our case). The first to e-file claiming the dependent (rightly or wrongly) will cause a rejection of any subsequent e-file claiming that dependent. You are probably stuck with filing on paper in that event. The IRS will eventually send a CP notice, but the first round of that is 4-5 months later and merely invites each of the taxpayers to file a 1040X "correcting" their possible mistake. If there's still a conflict after some length of time (couple of months), i.e. if no one amends, then the subsequent correspondence from the exam people will ask for further information (according to Practitioner Priority Services). Good luck.