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wepperly
New Member

We care for our grandson and are partially reimbursed for it. He lives with us and has no where else to live nor do we. We were told we don't have to pay federal tax .

I don't know how to enter that information or how to go about it.  Thanks for your  help.
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4 Replies
wepperly
New Member

We care for our grandson and are partially reimbursed for it. He lives with us and has no where else to live nor do we. We were told we don't have to pay federal tax .

Our grandson is 25 years old and is on SSI disability.  We were told because he requires a lot of care and we are reimbursed through a government program that due to 2014-7 we don't have to pay taxes on that income.  I don't know how to enter it under the miscellaneous income.  It requires taxes and gives no where to enter the fact that they held taxes out.  I guess they shouldn't have but they did.
DianeW
Expert Alumni

We care for our grandson and are partially reimbursed for it. He lives with us and has no where else to live nor do we. We were told we don't have to pay federal tax .

It is stated in this link that it is not considered income (Medicaid payment):  <a rel="nofollow" target="_blank" href="https://www.irs.gov/irb/2014-4_IRB/ar06.html#d0e451">https://www.irs.gov/irb/2014-4_IRB/ar06.html#d0...>
Look under the Guidance section.
JaimeG
New Member

We care for our grandson and are partially reimbursed for it. He lives with us and has no where else to live nor do we. We were told we don't have to pay federal tax .

Whether or not you have to pay Federal Income Tax is determined by quite a few factors. TurboTax will apply all allowable Credits and Deductions based on the information that you have entered, therefore letting your know if you will owe taxes or not. 

Since the child is your Grandson (blood relative); if he is under the age of 18 (or 24 if a student, you provide more than half of the child's support, and he lived with you for more than half of the year, you can claim him as your dependent. This will allow you a dependent exemption for the child. This exemption is a $4050.00 downward adjustment when determining your Taxable Income. Please keep in mind that this exemption does not always translate into a refund. 

If the child has already been claimed on another Taxpayer's return, the IRS will reject your attempt to e-file. If the IRS rejects your return and you feel that you are absolutely entitled to claiming him as a dependent, since it is quite late in the Tax Season you must file your return by mail. If the person that claimed the child is willing to make and amendment to their return to remove the child in order for you to claim them, you must file and Extension to allow time for the amendment to be processed by the IRS, since it can take up to 16 weeks. 

Below are FAQs with instructions on Printing your Return to file by Mail, and for filing and Extension:

https://ttlc.intuit.com/replies/3401713

https://ttlc.intuit.com/replies/3301811

 

We care for our grandson and are partially reimbursed for it. He lives with us and has no where else to live nor do we. We were told we don't have to pay federal tax .

<a rel="nofollow" target="_blank" href="https://www.irs.gov/individuals/certain-medicaid-waiver-payments-may-be-excludable-from-income">http...>
♪♫•*¨*•.¸¸♥Lisa♥ ¸¸.•*¨*•♫♪
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