Me, my husband and our 2 children have been living in the same household as his mother for about 4 years now. This past year me and my husband have not been able to work and contribute financially due to issues (luckily he is going back to work next week!). We did apply for assistance and get food stamps and Medicaid. My mother in law is not on our welfare case, however, they do know that she supports us financially. My question is, would my MIL be able to claim all 4 of us or even just our 2 children on her taxes for the 2018 year? And if so, would that mess up the assistance that we have gotten from the state? Thanks for the help!
If each person individually has less than $4,050 of taxable income for 2018, lived in her house for the entire year, and she provided more than half the support, then MIL qualifies to claim you as a dependent on her tax return. Period. I've never heard of such a situation affecting one's qualifications for 3rd party assistance, such as welfare. But I can't definitively say it won't. I will say however, that I "doubt" it will.
This was exactly the information that I was looking for. Thank you so very much for your time in answering this question.
but note the end result of the credits will be different. Children can qualify for up to $2000 each (assuming under 17 years old on Dec 31) while parents can qualify for Other Dependent Credit of $500. There are no 'deductions' given the new tax laws, only credits for dependents;.