Where I list dependent & relationship, I've always listed "child". TurboTax offers only son/daughter. Why? Are they stealing extra data to sell to marketers?

[Devin · Accepted solution]

I've worked on the interview questions of TurboTax for close to a decade. The reason we sometimes ask questions that specify gender, such as the son or daughter question, is very simple. We often have to ask follow up questions that refer back to a person mentioned in an earlier response, and it's much easier and feels more personal if those questions are framed using pronouns like he/she/his/hers/etc. If we keep using the child's name over and over, or resort to non-gender-specific pronouns like "they", then the language of the follow up questions starts to sound very unnatural, and possibly even confusing (is "they" referring to all my kids?).

Marketing never even entered our mind as a consideration. Even if it had, there are extraordinarily strict rules imposed on tax software companies by the Treasury Department to prevent tax data from being used for any purpose other than preparing the tax return. We wouldn't jeopardize a very successful and honest business by running afoul of Treasury rules. And even without those rules in place, our business model is based on charging a fair price to the customer, not luring people in with give-aways and then selling your data to third parties.

[Hal_Al]

It's always been that way. The first screen (relationship) asks child or someone else. After you select child, the next screen ask son or daughter.

Check your past year(s) form 1040 or 1040A. Line 6c, column (3) says son or daughter, not child.

[xmatthewx]

That is not correct. My past returns say child, not son or daughter as you suggest. I previously filed my returns without TurboTax. Whether is has been that way before with TurboTax isn't really relevant. There is nothing on the tax form or instructions that says son/daughter distinction is required. But that info is very valuable when you business sells data insights.

And, there are lots of instances were those options would be incorrect. For example, if you became the legal guardian for your nephew, they might be your dependent but they are not your son.

[macuser_22]

A nephew is "Other person"  and select nephew form the menu.

[macuser_22]

"There is nothing on the tax form or instructions that says son/daughter distinction is required"  Yes there is.

See the 1040 form (<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/f1040.pdf">https://www.irs.gov/pub/irs-pdf/f1040.pdf</a>) lines 1-4 where dependents are listed.  It says "see instructions" .   Note that the instructions say *required*  so the relationship is required.  (relationship is defined elsewhere in the instructions)

The instructions say:
"Follow the steps below to find out if a person qualifies as your
dependent, and to find out if your dependent qualifies you to
take the child tax credit or the credit for other dependents. If
you have more than four dependents, check the box on the right
side of page 1 of Form 1040 (just above the Dependents section)
and include a statement showing the information required
in columns (1) through (4)."

[jam]

The "Interactive Tax Assistant (ITA)" has far more options, including simply "biological child" <a rel="nofollow" target="_blank" href="https://apps.irs.gov/app/IPAR/investigate/IPAR_1/en-US/Attribute~Dependents~global~global/qs%24s63%4...>

[xmatthewx]

Thanks Jam, that's helpful. Macuser – I did not say that relationship wasn't required. I said that the distinction between son/daughter is not required by the IRS. And I see nothing in your comment or the instructions that says it is required. Why would it be required? It has absolutely no impact on this relationship's tax status. I'm sure there are many other relationship distinctions that would impact taxes, but son/daughter is definitely not one of them. That distinction is, however, very valuable marketing information.

[macuser_22]

"That distinction is, however, very valuable marketing information."   Just for the record, and for what it is worth,  it is against Federal tax laws and privacy laws to share, or divulge ANY information from a tax return to anyone or to use any such information for any purpose other than filing the tax return.   The most that can be shared is information that you provided in your account profile that is not tax return related.     Information on a tax return is well protected by Federal law and it would be a criminal offense to share or use for marketing purposes.

[xmatthewx]

True. And, I wonder if they circumvent that by asking if you want to opt in to certain services, such as creating a profile of your info to transfer it to next year's return, or compare across years for audit risk. Once you opt-in, you'll have a whole new set of terms and conditions, and that law won't apply. Data brokers can connect your mortgage info to your mobile app usage to your ad network data. The data is commonly collected, sold and used. Most customers can use the free version of turbotax, but the company has an obligation to shareholders to maximize the return on their investment.