Discussion:Earned income credit where qualifying child filed own return
From TaxAlmanac
Discussion Forum Index --> Basic Tax Questions --> Earned income credit where qualifying child filed own return
Discussion Forum Index --> Tax Questions --> Earned income credit where qualifying child filed own return
| 17 June 2008 | |
| If a child, who would be a qualifying child for purposes of the Earned Income Credit, files his own return and takes the personal exemption, will the parent still be eligible for the Earned Income Credit?
I haven't found any authority saying that the child wouldn't qualify (mainly Sec. 152(c)). My client has a very large overpayment which I would not want to be held up in an EIC controversy. So I would appreciate anyone's experience with this issue. -- Larry Hess, CPA | Albuquerque, NM | Talk to me | |
| 17 June 2008 | |
| Yes, it is theoretically possible for a qualifying child for purposes of the EITC to qualify as such without being a dependent of any taxpayer. A child who provides over one-half of his own support could be a qualifying child for EITC purposes, but would not qualify as a dependent of any taxpayer.
If the child does not provide over one-half of his own support, then he would appear to be a dependent of another taxpayer and would not be eligible to claim a personal exemption for himself. See Internal Revenue Code ยง 151(d)(2). | |
| 17 June 2008 | |
| Riley, that's the conclusion I've come to as well. Yet, something just doesn't "feel" right if the child claims the personal exemption on his own return. That I'm bothered by the possibility of an e-file rejection caused by the same SSN appearing on one taxpayer's Form 8867 and another's Form EIC. -- Larry Hess, CPA | Albuquerque, NM | Talk to me | |
| 17 June 2008 | |
| The EITC is available to the parent as long as the child is a qualifying child, but without regard to the support test. The fact that the child claims a personal exemption for himself is another issue altogether and the parent doesn't really need to be concerned about this unless he is claiming a dependency exemption for the child. | |
| 17 June 2008 | |
| I've seen this situation come across my desk many times at the IRS. The answer has always been the same - to piggyback on the good advice from Riley2, to avoid conflict in the system [between the parent's and child's returns], the parent has to take the child as a qualifying dependent for EITC purposes - no exceptions. The child can file a return, however, they cannot claim themselves for exemption purposes, in other words, they "willingly" must give up their exemption. Anything short of the above will delay your client's overpayment as sure as the sky is blue. Plus, your client may not like having to file paper because of an e-file rejection. | |
