gross income test for qualifying dependent
Question about the gross income test for a quaalifying relative. The income test states that Gross Income does not include "certain social security benefits". Can anyone define "certain SS benefits"?
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c8rSbOoaSr346iacfA8pyY
03/25/10 5:42am PDT
Viewed by asker 03/25/10 8:57am PDT
Viewed by asker 03/25/10 8:57am PDT
8 Replies
TAXOH
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03/25/10 6:15am PDT
I'm just guessing on this answer. I think for the gross income test it means do not include the SS benefits if they are nontaxable to the recipient if they had filed a return. You do need to include the SS benefits as part of the support test though.
If this does not answer your question hopefully someone else will be along to help.
IRMN
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03/25/10 6:44am PDT
TAXOH is correct.
If this answers your question please click, um, ok I forgot what you are supposed to click. If this answered your question, how about just saying thanks and we will call it good.
03/25/10 6:56am PDT
Not sure that I follow. The relative only has SS income. No return is filed for her, but her ss income is about $20000. Is that excluded from the gross income test or not?
TAXOH
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03/25/10 7:02am PDT
Yes from the gross income test. You would need to include it in the support test though.
If this does not answer your question hopefully someone else will be along to help.
03/25/10 7:13am PDT
So the bottom line is that mom cannot be claimed as a dependent, right?
TAXOH
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03/25/10 7:16am PDT
It depends on how much her support is and how much of that SS she uses towards her own support. If someone else is providing more than 50% of her support then they can claim her.
If this does not answer your question hopefully someone else will be along to help.
Accountant Man
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03/25/10 7:50am PDT
If her only "income" is SS then her "gross income" is zero. If she banks all of it and her daughter spends more than 50% plus $1 to support her than she can be claimed as a dependent.
If you use Pro Series Basic I might not be able to help you. If you use Turbo Tax I might refuse to help you. All others, watch out! ;-)
rbynaker
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03/25/10 7:53am PDT
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If mom has $100K/year of nursing home costs and only collects $20K of SS income then she's not supporting herself. If she's lived in the same old house for 50 years, the mortgage is paid off and she gets tax relief from the county then $20K may easily cover her living expenses.
I think the bottom line is you need to do a support test. Not always a fun calculation but you can run through it with your client with broad strokes numbers (rounded estimates) and see if you're in the ball park. If your ball park numbers show that mom is supporting herself 70% then no need to proceed. If child is supporting mom 70% I probably wouldn't go any further, just claim the exemption. If child is supporting mom 52% then you better get some more detailed numbers.
Rick
