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juliomora
New Member

I had to report my child's education grant as income on her 2015 taxes and paid underpenalty for her, can I deduct that underpayment of federal and state on my own income tax for 2016?

 
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HelenaC
New Member

I had to report my child's education grant as income on her 2015 taxes and paid underpenalty for her, can I deduct that underpayment of federal and state on my own income tax for 2016?

You can't deduct the federal income tax paid but you can deduct the state income tax that you paid with your child's 2015 income tax return. You can only deduct it on your child's income tax return.

Note: Most tax penalty and interest payments are not deductible off of your income tax return(s). The U.S. Congress specifically ruled that these expenses are not deductible; if they were, there would be no incentive for taxpayers to pay on time and avoid penalties, as paying penalties would provide a tax break in the following year.

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HelenaC
New Member

I had to report my child's education grant as income on her 2015 taxes and paid underpenalty for her, can I deduct that underpayment of federal and state on my own income tax for 2016?

You can't deduct the federal income tax paid but you can deduct the state income tax that you paid with your child's 2015 income tax return. You can only deduct it on your child's income tax return.

Note: Most tax penalty and interest payments are not deductible off of your income tax return(s). The U.S. Congress specifically ruled that these expenses are not deductible; if they were, there would be no incentive for taxpayers to pay on time and avoid penalties, as paying penalties would provide a tax break in the following year.

juliomora
New Member

I had to report my child's education grant as income on her 2015 taxes and paid underpenalty for her, can I deduct that underpayment of federal and state on my own income tax for 2016?

Thank you

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