@AmeliesUncle please help me with your response. Support includes 'fair share' of the parents housing expense and the child's educational expenses, right?
<<he need not have "paid" for half his expenses, he need only have "earned" more than half his expenses.>>
The IRS publication states "support costs"; where does it state "expenses"?
"Was a full-time student at least age 19 and under age 24 at the end of 2024 and didn’t have earned income that was more than half of the child's support."
What if the student's parent's live in a multi-million dollar mansion and the student is an only child. The "fair rental value" is going to be quite high. What if the student went to a private college? the educational cost would be quite high. and therefore the support costs would be quite high.
On the otherhand if the student when to a public university and the parents live in a small home with many dependents, that would change the outcome as the support costs would be a lot less.
How can any of us be sure that earned income exceeds half the support cost to be certain the student is not beholden to kiddie tax?
The support cost is determined on lines 6-19 of the worksheet (page 16 of Pub 501), so if his earned income is more than 1/2 of Line 19, then no "kiddie tax" implications . How would any of us know whether that is true?
I agree the support costs can not be actual costs, if only because the housing costs are inferred as the "fair rental value" of the home (line 6b). There is no reason the rest of the costs wouldn't be actual support costs.
https://www.irs.gov/pub/irs-pdf/p501.pdf
