My disabled daughter 28 worked part time, made $5200. We provide all of her support. Can I claim her as a dependent If Her SSI was rejected.

[Coleen3 · Accepted solution]

Yes, if she is permanently and totally disabled.

In general, to be a taxpayer’s Qualifying Child, a person must satisfy four tests:

Relationship — the taxpayer’s child or stepchild (whether by blood or adoption), foster child, sibling or step-sibling, or a descendant of one of these.

Residence — has the same principal residence as the taxpayer for more than half the tax year. Exceptions apply, in certain cases, for children of divorced or separated parents, kidnapped children, temporary absences, and for children who were born or died during the year.

Age — must be under the age of 19 at the end of the tax year, or under the age of 24 if a full-time student for at least five months of the year, or be permanently and totally disabled at any time during the year.

Support — did not provide more than one-half of his/her own support for the year.

 Permanently and Totally Disabled 

Your child is permanently and totally disabled if both of the following apply.

• He or she can’t engage in any substantial gainful activity because of a physical or mental condition.
• A doctor determines the condition has lasted or can be expected to last continuously for at least a year or can lead to death.

[Opus 17]

She is disabled for tax purposes if she is unable to perform gainful work due to a condition that is permanent or likely to lead to death.

If she is disabled, she can be your dependent.  If she is not disabled for tax purposes, then her income disqualifies her.

Earning $5200 would be evidence of be able to perform gainful work (and not disabled for tax purposes), if she is working a regular job at a wage that is customary for the position, under working conditions similar to other employees.  If she is working in a sheltered workshop, or under some kind of special circumstances that provide extra assistance to disabled persons to work (subsidized program, special working conditions, etc.) then her earnings may not be automatic proof of non-disability.  

If you claim her as a disabled dependent, but she has a W-2 for a regular job, you can expect that the IRS may investigate to see if she really meets the definition of disabled for tax purposes.  You need to have a good argument and document your reasons.

[Opus 17]

Disabled for tax purposes is not the same as disabled for SSI, although the decisions may involve similar factors.

[oakley-88]

Thank you, $1800 of her income was as an internship through Vocational Rehab and the rest was through a temporary part time job so I was unsure if I should claim her or not.

[macuser_22]

I suggest that you read the IRS Pub 524 starting on page 3 to determine that.  They give several examples.
<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p524.pdf">https://www.irs.gov/pub/irs-pdf/p524.pdf</a>

[Opus 17]

It depends on the facts and circumstances for each person.  Having a "regular" job does not always mean the person is not disabled.