Thank you so much for your clarification TaxGuyBill. They really made it confusing putting the title for the section (f)(3) as "Rules for individuals who neither file a tax return nor are claimed as a tax dependent." It would make any reader just skip the entire section if you are looking for rules for individuals claimed as a tax dependent. Then much further in the paragraph they include, "or who are described in paragraph (f)(2)(i), (f)(2)(ii), or (f)(2)(iii) of this section." Its only then as you pointed out that you realize that the section does make reference people who are claimed as a dependent in (f)(2)(i). Thank you again. Was it different before these new rules were promulgated under AFA (January 1, 2014)? Because I had always thought that once you claim your parent living with you then they become part of your household and many states' public assistance programs such as Medicaid use household income to determine elligibility.
