My 4yr old was awarded BACK PAY in 2016 from Social Security. She is approved for Survivors Benefits since I was approved for disability. Her back pay is OVER 25k.

[Lou4]

Based on HIGH dollar amount, do I need to report as income? 

[DanielV01 · Accepted solution]

No, you will not need to report this as income for either of you.  Any income listed for your daughter is never reported by the parent.  And this being the case, the social security amount received by your daughter (assuming she had no other income, of course) is not enough to be taxable, although it seems to be a sizable amount.  You have nothing to report for this amount on either of your returns.

[Lou4]

is there an amount that does become taxable? I looked and it's 37k for her SS backpay

[DanielV01]

Not even then.  Taxable SS is a complicated formula.  But as standalone income, it would take over 50k before it could even begin to be counted as reportable income, and several thousand more before enough would become taxable.  I had one client who had other income receive a lump sum of well over 30k and it was still not taxable.  Hope that is helpful to you.