Q. Can we still use the child expenses on our taxes?
A. Yes, you can claim the dependent care credit. You will have to provide her SS#.
Q. Will that mess up my wife’s father's taxes?
A. No. It has no effect because the amount is not enough to change the sister's dependent status, assuming she has little or no other income or is a full time student.
Q. Will effect the sister's taxes?
A. No. It is not enough to have to file (because she sat in your home) unless she has sufficient other income.
A dependent child must file a tax return for 2021 if he had any of the following:
- Total income (wages, salaries, taxable scholarship etc.) of more than $12,550 (2021).
- Unearned income (interest, dividends, capital gains, unemployment) of more than $1100.
- Unearned income over $350 and gross income of more than $1100
- Household employee income (e.g. baby sitting, lawn mowing) over $2300 ($12,550 if under age 18)
- Other self employment income over $432, including money on a form 1099-NEC
