Discussion:Dependency Exemption for married parents

From TaxAlmanac, A Free Online Resource
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.

From TaxAlmanac

Jump to: navigation, search

Discussion Forum Index --> Advanced Tax Questions --> Dependency Exemption for married parents
Discussion Forum Index --> Tax Questions --> Dependency Exemption for married parents

Kerrypoon (talk|edits) said:

4 April 2008

My client provided more than 50% support to both of her parents in 2007. Her parents filed their own returns (both "being claimed as dependents")reporting interest income of $5500, which was their only income. The Code said that qualified dependents could not file joint returns unless they are only claiming a tax refund. In this case, does it mean we have to tell her parents to amend their returns to MFS so as to facilitate the deduction on their daughter's returns?

Linsals (talk|edits) said:

6 April 2008

Each one would have to have less than $3,400 in income to be claimed as a dependent on the daughter's return. It would be important to note whose social security number is on the 1099-INT statements. If it happens to be all to the husband, then he wouldn't be able to be claimed on the daughter's return. The rules say that the dependent qualifies if they are a relative, AND had gross income of less than $3,400 for 2007. You'll have to check that first. If the interst income happens to be split 50/50, they wouldn't have even had to file. Another thing to consider is the Economic Stimulus Rebate coming up. If you amend their returns and have them NOT claim themselves on their MFS returns, no one gets the rebate. The daughter will not get any extra rebate money for them as dependents. It is only for children under the age of 17. But if the parents had Social Security income and interest income, they will most likely qualify for the rebate. Think about that, too before you amend and figure out what is the best dollar benefit. Other than all that...............yes you would have to amend those returns if you want to claim them on the daughter's return filing MFS as you said!