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m2c67
New Member

Does military retirement count as earned income for the purpose of determining dependent eligibility?

My parent lives with me and I provide more than half of the living expenses. I am unmarried. My parent receives part of their former spouses military retirement (they are divorced) on a monthly basis. Does this income count as "earned" to be calculated as part of the determination if I can claim head of household?

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1 Best answer

Accepted Solutions

Does military retirement count as earned income for the purpose of determining dependent eligibility?

The retirement/pension income reported on a Form 1099-R is taxable income so is part of their gross income under the Qualifying Relative rules.

To be a Qualifying Relative -

1. The person cannot be your qualifying child or the qualifying child of any other taxpayer. A child is not the qualifying child of any other taxpayer if the child's parent (or any other person for whom the child is defined as a qualifying child) is not required to file an income tax return or files an income tax return only to get a refund on income tax withheld.

2. The person either (a) must be related to you or (b) must live with you all year as a member of your household. 

3. The person's gross income for the year must be less than $4,150 (social security does not count) in 2018

4. You must provide more than half of the person's total support for the year.

5. The person must be a U.S. citizen or a U.S., Canada, or Mexico resident for some part of the year.

6. The person must not file a joint return with their spouse.

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2 Replies

Does military retirement count as earned income for the purpose of determining dependent eligibility?

The retirement/pension income reported on a Form 1099-R is taxable income so is part of their gross income under the Qualifying Relative rules.

To be a Qualifying Relative -

1. The person cannot be your qualifying child or the qualifying child of any other taxpayer. A child is not the qualifying child of any other taxpayer if the child's parent (or any other person for whom the child is defined as a qualifying child) is not required to file an income tax return or files an income tax return only to get a refund on income tax withheld.

2. The person either (a) must be related to you or (b) must live with you all year as a member of your household. 

3. The person's gross income for the year must be less than $4,150 (social security does not count) in 2018

4. You must provide more than half of the person's total support for the year.

5. The person must be a U.S. citizen or a U.S., Canada, or Mexico resident for some part of the year.

6. The person must not file a joint return with their spouse.

rjs
Level 15
Level 15

Does military retirement count as earned income for the purpose of determining dependent eligibility?

Note that the income limitation applies to *gross* income, not *earned* income.
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