Discussion:Deductibility of Foster Care Payments
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| Revision as of 03:58, 23 October 2009 R2 (Talk | contribs) (The operative wo) ← Previous diff |
Current revision Smokeytax (Talk | contribs) (Good luck to you) |
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| Nor would a miscellaneous deduction be allowed since this payment does not relate to a trade or business or property held for the production of income.}} | Nor would a miscellaneous deduction be allowed since this payment does not relate to a trade or business or property held for the production of income.}} | ||
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| + | {{ForumReplyPost|UserID=Smokeytax|Date=23 October 2009|Text=Good luck to your clients - parents of teenagers are very high on prayer lists . . .}} | ||
Current revision
Discussion Forum Index --> Basic Tax Questions --> Deductibility of Foster Care Payments
Discussion Forum Index --> Tax Questions --> Deductibility of Foster Care Payments
Rreevestax (talk|edits) said: | 22 October 2009 |
| I have a client whose child (16 yo girl)has been removed from the home and placed into foster care. The county is asking them for income information with the intent of billing my clients for their childs foster care. I have researched Pub 529 Misc Deductions, and have used Checkpoint and Tax Almanac to learn if payments to the county for foster care are deductible. So far I have not found anything on point, most of the references speak about including foster care receipts in income, as opposed to paying fees. I think this should be a miscellaneous deduction subject to 2%, girl is too old to get Dependent Care deduction, and she won't be able to qualify as a dependent after she is out of family home for more than six months.
Can anyone confirm 2% miscellaneous? Any better ideas on where/how to claim these fees which would avoid 2% haircut? I appreciate anyones help. Ray Reeves | |
| 22 October 2009 | |
| Hee, hee, hee, you a very funny man!
It sounds like your client has bigger issues than a tax deduction. | |
Rreevestax (talk|edits) said: | 22 October 2009 |
| Yes indeed, but I don't think the problem is what you are thinking. Girl is a wild child, pregnant, but not because of her father. Bio parents couldn't handle her, wanted her out of the house to protect younger daughter. Any thought on the tax deduction? | |
Death&Taxes (talk|edits) said: | 22 October 2009 |
| Maybe you should look at Publication 526. In a way, this is a contribution to a government but for the benefit of a specific person, and, as such, not deductible as a contribution. | |
| 22 October 2009 | |
| Agree with D&T, and also wonder if the payment could be equated to child support (but rather than the non-custodial parent paying the custodial parent non-deductible support money, the non-custodial parents pay the county, since the county has in effect assumed custody...) and if so that ought to be non-deductible. Although perhaps that definition would differ county by county. What is the county calling the payment your clients would potentially be paying? | |
Rreevestax (talk|edits) said: | 23 October 2009 |
| Thanks for the replies, I will look into Pub 526, I see you point about child support payments. Countys letter calls payment a foster care fee order. | |
| 23 October 2009 | |
| The operative word here is “order”. No charitable deduction is allowed for any payment mandated by local law or court order.
Nor would a miscellaneous deduction be allowed since this payment does not relate to a trade or business or property held for the production of income. | |
| 23 October 2009 | |
| Good luck to your clients - parents of teenagers are very high on prayer lists . . . | |
