Another income tax question

[mamacatnv]

Can someone claim their adult child and their Grandchildren as dependents if they are supporting them?
I have a co-worker who just came in with an updated W-4, she is claiming adult daughter (age 22) and 2 grandkids (1 & 3) as her dependents because they live with her, do not work and Grandma is the only support. She does claim them as her dependents on her tax return also and files as head of household.
The DD gets Medicaide for her and the kids but Mom said "nothing else"
This is a new one, she says she has been doing it for a couple of years since the first grandbaby came along.

I thought one had to be legally connected via parent/guardian etc to claim a another as a dependent.

 

[koolaidmoms]

Can someone claim their adult child and their Grandchildren as dependents if they are supporting them?
I have a co-worker who just came in with an updated W-4, she is claiming adult daughter (age 22) and 2 grandkids (1 & 3) as her dependents because they live with her, do not work and Grandma is the only support. She does claim them as her dependents on her tax return also and files as head of household.
The DD gets Medicaide for her and the kids but Mom said "nothing else"
This is a new one, she says she has been doing it for a couple of years since the first grandbaby came along.

I thought one had to be legally connected via parent/guardian etc to claim a another as a dependent.

She is correct. If they make less than the exemption and she can prove that she provided the majority of support for her daughter and GKs she can indeed take them as dependents.

You can take anyone as long as you can prove that you provide the majority of the support. Can be parents, co-habitators, etc...

 

[golfgal]

An a W-4 you just have to write in how many exemptions you want to claim-basically telling the company how much you want taken out of your taxes each paycheck. You don't have to say who the dependents are. That number doesn't have to match the number living in your house--but if you have too little withheld thorough the year you CAN pay a penalty for that.

Is this for something else?

 

[mamacatnv]

Huh....I never knew that, Thanks! Works for me, I was worried she could wind up in a pickle with the IRS

 

[mamacatnv]

An a W-4 you just have to write in how many exemptions you want to claim-basically telling the company how much you want taken out of your taxes each paycheck. You don't have to say who the dependents are. That number doesn't have to match the number living in your house--but if you have too little withheld thorough the year you CAN pay a penalty for that.

Is this for something else?

Thanks - I do know how a W-4 works, I just did not know one could claim adult kids w/kids, and I should I am the Accounting Mngr.....
I've seen the Married with 15 dependents for the single guy with a dog type of withholding declarations.
The exempt tax protesters etc.
But
I have never had an employee claim grandkids and the parent of the grandkids as dependents.

My accountants line was busy, whats the second best thing? The Dis of course

 

[eduk8r26]

I may be wrong but I thought to claim someone who is 22 as a dependent they had to be a full-time student or disabled. And I'm assuming the mom of the kids is not filing a tax return since she is not working.

 

[DisneyBamaFan]

I may be wrong but I thought to claim someone who is 22 as a dependent they had to be a full-time student or disabled. And I'm assuming the mom of the kids is not filing a tax return since she is not working.

Nope - Really, the only thing that the IRS cares about is that this person is only claimed on one return.

 

[tvguy]

I've seen the Married with 15 dependents for the single guy with a dog type of withholding declarations.

Until the IRS outlawed it, I always claimed 0 deductions, and had a specific percentage of my pay withheld. It was the only way I could get my witholding to match what my taxes ultimatly ended up being. Now with only deductions , if I claim 4 I end up getting a $1,000 refund, if I claim 3, I owe $1,000.

 

[mamacatnv]

I may be wrong but I thought to claim someone who is 22 as a dependent they had to be a full-time student or disabled. And I'm assuming the mom of the kids is not filing a tax return since she is not working.

Correct assumption, the mom of the grandkids does not work

Until the IRS outlawed it, I always claimed 0 deductions, and had a specific percentage of my pay withheld. It was the only way I could get my witholding to match what my taxes ultimatly ended up being. Now with only deductions , if I claim 4 I end up getting a $1,000 refund, if I claim 3, I owe $1,000.

Claim 3 + an additional $41.67 for semi monthly, an additional $19.23 for weekly and $38.47 for bi-weekly.
That will cover your $1000 deficit

 

[Cheshire Figment]

On the tax return itself she can claim all of them as dependents and file as head of household.

As far as filing of a W-4 for withholding, a person is allowed to claim as many exemptions as are necessary for them to have the proper amount of tax withheld. It is up to them for both status and number.

It is a requirement that a copy of the W-4 be sent to IRS if a person claims ten or more exemptions. If the IRS determines the number is to high they will notify the employer of the maximum that can be claimed for this individual.

Otherwise it is not up to the employer to make any determination or decision on their own.

Mike (CPA Retired, but still with a tax practice)

 

[arminnie]

I've seen the Married with 15 dependents for the single guy with a dog type of withholding declarations.

Well I'm single and have claimed well over 25 deductions on multiple occasions.

One time I got questioned by IRS. She kept questioning it and then finally said but you had to pay $5000 at tax time (which would not have been okay). I said "Look again - I still got a $5000 REFUND). I should have claimed more exemptions. We laughed over it.

 

[SandrA9810]

So what happens if the daughter does make more than the exemption, which is believe is 5,700 for 2010?? Would the IRS double check that or audit the mother/daughter?

 

[Cheshire Figment]

Years ago I had a client with a live-in girlfriend. She did not work and provided 100% of her support, so he was legally entitled to claim her as a dependent, which he did. But he was not able to file as Head of Household as they were not related.

 

[MrsJackSparrow4Life]

Chances are, if the mother is not working, she is also not filing taxes. As long as someone else doesn't claim the dependents (such as the mother or the father) the IRS is probably not even going to look into it.

 

[arminnie]

My father lived with me the last 10 years of his life. I provided 100% of his income including spending money for a cup of coffee. I claimed head of household with him as a dependent. I am not looking forward to my taxes this year! first one with him gone.

 

[eduk8r26]

What stinks is when the IRS changed its rules about head of household. My daughter ande her kids live with me. I pay the rent, utilities and buy most of the food. Up until a few years ago I could take one of her kids as a qualifying child and file head of household. She took the rest and filed head of household also. Then the rules changed and I could no longer do that. So now she claims them all and takes head of household and I file single. Even though she worked, I let her do it because she needed the child care credit and all that.

 

[Mrs. Charming]

Years ago I had a client with a live-in girlfriend. She did not work and provided 100% of her support, so he was legally entitled to claim her as a dependent, which he did. But he was not able to file as Head of Household as they were not related.

Waaaaait... so a wife that doesn't work and isn't disabled is a dependent and can be claimed as such on a tax return (1040)? Or am I reading this totally wrong?

 

[wvjules]

Waaaaait... so a wife that doesn't work and isn't disabled is a dependent and can be claimed as such on a tax return (1040)? Or am I reading this totally wrong?

You are reading that wrong. A wife would be a spouse.

 

[Mrs. Charming]

You are reading that wrong. A wife would be a spouse.

Thank you. I'm a bit distracted today. We did our taxes last night and this question came up, and I told DH that I'm 99% sure I'm not a dependent. I read this and thought.."Crap!"

Thanks for the clarification.

 

[Cheshire Figment]

For a nonworking spouse there is the personal exemption and also the Married Filing Jointly rates on the return.