@FedUpParent wrote:
What does immaterial income mean? I am certain she's earned over $4300.00 while she was living here. I am just floored that I took care of all the bills and supported anything she and the kids needed while living in my home. I provided about 80% of the living expenses for her and my grandchildren. I even received a letter from the IRS regarding the child tax payments which I opted out of receiving in monthly payments. I just don't understand how you can financially support a person and because they earned a minimum of 4300.00, they can receive a refund that's insane to me. Especially when anyone knows it requires much more than that to support two children and an adult for a year. However, I do hugely appreciate your response and information. I just hate to risk getting into any kind of scandal although I am legally and morally correct.
Being a tax dependent has to follow the law, which does not always recognize "support."
For a child who is age 23 or less and also a full time student, the support test is "did not provide more than half their own support". So it doesn't matter how much your daughter earned as long as she did not provide more than half her own support. It isn't even necessary for you to be the person who provided support, only that she live in your home more than half the nights of the year and provide less than half her own support.
However, if your child is age 24 or older, or age 19 or older and not a full time student, the law uses different rules. In that case, the child can't be claimed as a dependent if they have more than $4300 of taxable income, and you specifically must provide more than half their support. That's just how the tax law was written (in the 1950s, last overhauled in 1986).
Of course, each person is evaluated separately, so you may be able to claim the grandchildren even if you can't claim your daughter. But there, we have to consider what happens to the family if you file conflicting claims.
