Can I claim a friend that has been living with me that didn't have an income for the entire year? Can I also claim her children?

[Mindough]

Oops, I was wrong. The amount of child support is $104/week for all 3 children. Not per month.

[BobB7]

Well, in order to see if you can claim her and/or her kids, you would have to do a support worksheet.  But it seems unlikely that it will show that you provide over half the support.  In which case you could not claim them.

[Mindough]

It would probably benefit all of us if she filed with her husband (even though they are living apart) and split the return between them, since she didn't have an income?

[BobB7]

I agree that this would be much better financially if both parties are OK with the idea.

[Mindough]

Thanks so much Bob. This is the way we are going to go. I appreciate all of your advise!!

[BobB7]

Glad to help and glad it all worked out.

[BobB7 · Accepted solution]

Whether you can claim them comes down to whether you provided over half their support.  Without knowing whether the 104 is per child or how she and the kids are able to cover their non rent expenses it's hard to guess the answer to that, but it's probably at least a close call.  Unless you are also providing lots of food or other monetary support.

But:  You certainly do NOT have to pay tax on 650*12 of income.  You DO have to report it as rental income but if you do your tax return as though you have rental income you get lots of deductions from that: their share of utilities, heating costs, property tax, property insurance, garbage pick-up,snowplowing, etc.  Plus some depreciation on your house.  It's a bit more complicated and requires a bit more expensive version of the software but it's likely to save you a lot of tax by reducing the amount of the 650 which actually gets taxed.