Clarification
How old is your son? If your son is an adult and lives with you but does pay you rent at FMV, then you are correct, he would not be your dependent because you are not providing over half of his support.
He is an adult with autism. His SSDI/SSI pays his room and board at FMV.
Q.My son is on SSDI. He pays us room and board each month at Fair Market Value.
Am I correct in saying he does not qualify as a dependent?
A. Not necessarily. "Pays us room and board each month at Fair Market Value" does not show that he pays more than half his own support.
There are two types of dependents, "Qualifying Children"(QC) and Other ("Qualifying Relative" in IRS parlance even though they don't have to actually be related). There is no income limit for a QC but there is an age limit, student status, a relationship test and residence test.
A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:
The support test is different for each type. The support test, for a QC, is only that the child didn't provide more than half his own support. The support test for a Qualifying Relative is that the taxpayer provided more than half the relative's support.
So, it doesn't matter how much income he has, . What matters is how much he spent on support. Money he put into savings does not count as support he spent on himself.
The support value of the home, provided by the parent, is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.
The IRS has a worksheet that can be used to help with the support calculation. See: http://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf
See full dependent rules at: https://turbotax.intuit.com/tax-tools/tax-tips/Family/Rules-for-Claiming-a-Dependent-on-Your-Tax-Return/INF12139.html
I wonder if this getting too complicated.
My son receives ssdi and ssi only. About $10,000.
We were having him file a return each year just to be on the safe side.
I do not claim him as a dependent and now I am wondering if he should even bother with filing a return at all.
@AndrewA87 If the Social Security benefits he receives is his only income and there are no federal taxes withheld then there is no need for him to file a tax return.
Unless he also received a Form 1095-A for his health insurance through one of the State Marketplace Exchanges or from healthcare.gov then he must file a tax return.
Also, it's doubtful that he does not qualify as your dependent with only $10,000 of potential self support funds. You're missing out on the $500 "Other dependent credit".
Furthermore, even if he had to file (and he doesn't), with the tax law change, effective 2018, most dependents will have the same tax liability whether they claim themselves or not. The personal exemption has been eliminated and the standard deduction increased.
Since my son receives only SSDI and SSI should this be entered on line 1 or 23?
1. Enter the total funds belonging to the person you supported, including income received (taxable and nontaxable) and amounts borrowed during the year, plus the amount in savings and other accounts at the beginning of the year. Don't include funds provided by the state; include those amounts on line 23 instead
23. Enter the amount others provided for the person's support. Include amounts provided by state, local, and other welfare societies or agencies. Don't include any amounts included on line 1
Also for lodging. If the house is paid off how do I calculate my son's portion of the lodging?
Would it be finding a similar house nearby that is up for rent and multiply that monthly rent by 12 and then divide by the number of people living in the house?
Q. Since my son receives only SSDI and SSI should this be entered on line 1 or 23?
A. Line 1.
Technically, SSDI (Social security disability income) is his money and would go on line 1. SSI (supplemental security income) is more like welfare and could go on line 23. But for simplicity, line 1 should work.
Q. Would it be finding a similar house nearby that is up for rent and multiply that monthly rent by 12 and then divide by the number of people living in the house?
A. Yes.
Try entering your address at a real estate web site, like Zillow. They may have a rental value for your home.
How should I answer the following question on Turbotax regarding dependents?
Under if another taxpayer can claim my son - I put another taxpayer will not claim my son. (I know i will give up a credit)
I get asked if either statement applies to the other taxpayer? (which is me I assume)
-This person is required to file a 2024 tax return
-This person is filing a 2025 tax return for reasons other than getting a refund of taxes paid or withheld
yes or no
I am sorry that I have so many questions, But for question 1 - total funds belonging to the person supported would that include ABLE accounts? It says to include savings accounts and other accounts.
I am working on the support worksheet for a dependent. Turbotax says to included Medical insurance premiums.
My son, my wife, and myself are covered by my employers health insurance. I pay about $8,000/yr and my Employer pays about $30,000/yr.
Do I use I in the worksheet just what I pay in premiums in a year or both what I pay and what my employer pays ($38,000/yr)
Also the people in my household who are covered under my employers health insurance is just my son, my wife, and myself for a total of 3 people. Would I divide the premiums by 3 for the worksheet support test?
Thanks
Q. Do I use I in the worksheet just what I pay in premiums in a year or both what I pay and what my employer pays ($38,000/yr)?
A. Just what you pay,
Q. Also the people in my household who are covered under my employers health insurance is just my son, my wife, and myself for a total of 3 people. Would I divide the premiums by 3 for the worksheet support test?
A. No. You would use the add on premium. For example, if the employee and spouse premium is $6000 and family premium $8000, use $2000.
So do I count what I pay in premiums or do I count both the employee cost and the employer contribution?
Example
Employee & spouse = $5400 (employee Cost) $16,200 (Employer Contribution)
Employee & family = $7,800 (employee cost) $23,700 (employer contribution)
Dependent = $2400 ($7,800-$5400) Employee cost $7,500 ($23,700-$16,200) Employer contribution
So do I just use the $2,400 - Employee cost or both the employee cost and the employer contribution $9,900 ($2400 = $7500)?
Q. So do I just use the $2,400 - Employee cost or both the employee cost and the employer contribution $9,900 ($2400 = $7500)?
A. Just the $2400.
I was wondering if the purchases my makes from his own checking account for things like food/stuff that he consumes and other small purchases like things for his own entertainment would be considered support he provides himself, or are these types of purchases should not be considered when filling out the worksheet for determining support?
You may find Worksheet 2 helpful in figuring out whether you provided more than half of a person's support.