Friday, May 24, 2024

How To Block Someone From Claiming Your Child On Taxes

Don't Miss

What Is Stimulus Check For Dependents

3/25/2018 – What If Someone Else Is Claiming My Kids? – Mobile, AL – LawCall – Legal Videos

During the Covid-19 Pandemic, it has been hard to stand for the low-income family because there is no permanent income source. Millions of Americans are facing a crisis due to job loss, medium and small business shut down, and other reasons. So the stimulus checks or stimulus payment is one of the great ways to live hopefully better.

The President of the United States of America also declared this payment by stimulus check by $1.9 trillion to make sure the American can get back on track. This stimulus check payment depends on the college students age 17 to 24 who are depending on family and living with parents and guardians. They are directly dependent on their parents.

According to the IRS guideline, someone may get stimulus payment by filing a tax return. For example, in 2020 parents or guardians may file tax returns according to income guidelines and claim dependents on their income. After fulfilling all eligibility criteria, then the IRS will manage this stimulus check for the parents or guardians.

When Your Child Must File

In 2018 and 2019, certain children were taxed using the estate and trust tax brackets, but in 2020, for income above a certain level, the tax rate of the parents will be used. Four tests determine whether a dependent child must file a federal income tax return. A child who meets any one of these tests in 2020 must file:

  • If the child only has unearned income above $1,100
  • If the child only has earned income above $12,400
  • If the child has both earned any unearned income, and the child’s gross income is greater than either $12,400 or their earned income plus $350, whichever is less.
  • The child’s net earnings from self-employment are $400 or more

Additional rules apply for children who are blind, who owe Social Security and Medicare taxes on tips or wages not reported to or withheld by the employer, or who receive wages from churches exempt from employer Social Security and Medicare taxes.

If filing a return is required by the first test above and the child has no other income besides unearned income, you can avoid a separate filing for your child by making an election described later in this article.

Four tests determine whether or not a dependent child must file an income tax return with the IRS.

Can Divorced Separated Or Unwed Parents Both Get A Payment For The Same Dependent

With the first two stimulus checks during the pandemic, parents who weren’t married but shared joint custody of a child could each receive a payment for the same dependent if they had been alternating years claiming the child on their taxes. With the American Rescue Plan in March, Congress closed off that loophole for the third stimulus checks.

Can parents who share custody of a child take advantage of a similar loophole with the 2021 child tax credit? The short answer is no. Only one parent can get the credit for a shared dependent. If you’re the one who claimed the child on your latest 2020 tax return, then you’ll be the one receiving the advance payments this year. If you incorrectly collect payments for a child this year, you may have to repay part or all of the up to $3,600 credit next year.

Read Also: What Documents Do You Need For Tax Return

What To Do If You Or Your Parents Made Tax Return Errors

It’s sadly very common that adult children and parents don’t talk – especially about money and taxes. So, what happens if your parents claimed you on their taxes and you filed for yourself? Here are the tax consequences you and your parents will face if either of you make a mistake.

First, you will both get a notice from the IRS and will need to respond with the proper documentation. If you claimed yourself, and your parents claimed you, one of you has to make the correction to the tax return. After that return is processed, the other party may file their return next.

If you file your tax return before your parents file their tax returns, their return will get rejected for the dependent exemption. If your parents file before you file your return, then your return may get rejected for claiming the self-exemption.

If either the parents or child can prove that the other party wrongfully claimed the exemption, the party proven wrong may be subject to an audit.

In 99.5% of situations, it’s easier to have a simple conversation up front than have to deal with it via the IRS.

What Should Parents Do If They Alternate Yearly Custody Of A Dependent

Can married people file separate tax returns?

Even if parents have an arrangement to alternate custody of their dependent, the IRS won’t know who has primary custody until your 2021 tax return is filed next spring. Let’s say, for example, that you and a coparent switch between claiming a child in odd-numbered and even-numbered years. If you start receiving the advance child tax credit payments this year even though you won’t actually be claiming the child on your 2021 return, then you are technically not entitled to that money.

If this kind of arrangement applies to you, or if you haven’t yet determined which parent will be claiming the dependent for 2021, the best option is to unenroll from the monthly payment program.

Also Check: How To Appeal Property Taxes Cook County

Amending Your Tax Return

If you erroneously claimed your child as a dependent, the Internal Revenue Code allows you to amend your tax return within three years of filing the original or within two years of paying the relevant tax, whichever is later. However, eliminating the dependent generally increases your taxable income and may require you to pay additional tax for that year. Although penalties may apply to the underpayment, the IRS can waive them if you can convince them that it was an unintentional error.

Who Else Might Have Claimed Your Child

The IRS can’t tell you who claimed your dependent, because it’s prohibited by Section 6103 of the Internal Revenue Code. The agency can’t disclose information relating to a tax return to anyone other than the filer. That said, you probably have a good idea of who, if anyone, claimed your child. The culprit would have to know the child’s name, their Social Security number, and their date of birth.

But it isn’t always the child’s other parent who claims them. Maybe your ex and your child are living with another relative, who thinks they’re entitled. Identify theft is a problem as wellsomeone might have stolen your child’s Social Security number and might be using it to steal money from the U.S. Treasury.

Recommended Reading: Do I Pay Taxes On Stimulus Check

When Can I Expect My Refund With Eic 2020

More In Credits & Deductions If you claimed the Earned Income Tax Credit or the Additional Child Tax Credit , you can expect to get your refund by the first week of March if: You file your return online. You choose to get your refund by direct deposit. We found no issues with your return. ,

Learn About Tax Id Theft And How To Avoid It

Can I Claim Someone Else’s Kids On My Tax Return? Can I Claim My Girlfriend’s Kids on my Tax Return?

Tax ID theft occurs when someone uses your Social Security number to file taxes and claim a tax refund. You may not know that your tax ID has been stolen until you:

  • E-file your tax return and find that another return has already been filed using your Social Security number, or

  • The Internal Revenue Service sends a 5071C letter to the address on the federal tax return indicating that tax ID theft has occurred.

Find out what steps you can take after receiving a 5071C letter and how you can avoid or report tax ID scams.

Read Also: Where Do I Find My Tax Id Number

Who Qualifies As A Dependent

If your child meets all of these criteria, you can claim them as a dependent.

  • Relationship to you: To be claimed as your dependent the child must be an: child adopted child, foster child, brother or sister, or descendent of one of these relations
  • Residence: The child must live in your home address for at least half the year
  • Age: To be claimed as a dependent the child must be under age 19 or under age 24 and a full-time student. If a child is permanently disabled they can be any age to qualify as a dependent on your taxes.
  • Income: To qualify as a dependent the child must not have provided more than 50% of their own financial support during the tax year.
  • Joint Support: The child cant file a joint tax return unless its to claim a tax refund for federal taxes withheld or estimated taxes paid.
  • Now lets talk about how a relative can qualify as a dependent on your tax return.

    Tip: A single missed deduction can cost you hundreds of dollars. Trust TurboTax to get every deduction and the maximum refund you deserve. We have the best TurboTax coupons listed here to save up to an extra $20 on TurboTax Online!

    Answer When The Irs Contacts You

    About two months after you file a paper return, the IRS will begin to determine who is entitled to claim the dependent.

    You may receive a letter from the IRS, stating that your child was claimed on another return. It will tell you that if you made a mistake, to file an amended return, and if you didnt make a mistake, do nothing.

    The other person who claimed the dependent will get the same letter. If one of you doesnt file an amended return that removes the child-related benefits, then the IRS will audit you and/or the other person to determine who can claim the dependent.

    Youll get a letter in a few months to begin the audit. In the audit, the IRS will require you to provide proof that you are entitled to claim the dependent. Be sure to reply completely and by the IRS deadline. After the IRS decides the issue, the IRS will charge any additional taxes, penalties, and interest on the person who incorrectly claimed the dependent.

    You can appeal the decision if you dont agree with the outcome, or you can take your case to U.S. Tax Court.

    Its always a good idea to discuss claiming children with your family members before a situation like this arises, if possible.

    Don’t Miss: How Do You Report Bitcoin On Taxes

    Who Can You Claim This Credit For

    You may be able to claim the CCC if you support your spouse or common-law partner with a physical or mental impairment.

    You may also be able to claim the CCC for one or more of the following individuals if they depend on you for support because of a physical or mental impairment:

    • your or your spouse’s or common-law partner’s child or grandchild
    • your or your spouse’s or common-law partner’s parent, grandparent, brother, sister, uncle, aunt, niece, or nephew

    An individual is considered to depend on you for support if they rely on you to regularly and consistently provide them with some or all of the basic necessities of life, such as food, shelter and clothing.

    What If Two People Both Meet The Requirements To Claim A Dependent

    How To Avoid Paying Taxes Legally  and the 11 Craziest ...

    If two different people both have the right to claim the dependent according to the criteria listed above, the IRS will generally award the dependent to the person with whom the dependent lived for the greatest amount of time during the tax year. If the dependent lived with both people for an equal amount of time, then the IRS will award the dependent to the taxpayer with the higher AGI.

    Also Check: What Is New York State Sales Tax Rate

    How To Avoid Irs Imposter Scams

    There are things you can do to protect yourself from an IRS imposter scam.


    • Beware if someone calls claiming to be from the IRS. The IRS will always contact you by mail before calling you about unpaid taxes.

    • Ask the caller to provide their name, badge number, and callback number. Then call TIGTA at to find out if the caller is an IRS employee with a legitimate reason to contact you. If you confirm that the caller is from the IRS, call them back. Otherwise, report the scam call to TIGTA.

    • Become familiar with what fraudulent IRS email messages look like. Review a sample IRS phishing email.

    • Verify the number of the letter, form, or notice on the IRS website.

    • Be suspicious of threats. The IRS wont threaten to have police arrest you for not paying a bill.


    • Dont give in to demands to pay money immediately. Be especially suspicious of demands to wire money or pay with a prepaid debit card.

    • Dont trust the name or phone number on a caller ID display that shows IRS.Scammers often change the name that shows on caller ID using a technique called spoofing.

    • Dont click on any links in email or text messages to verify your information.

    Protect Documents With Personal Information

    If you have documents with your childs personal information, like medical bills or their Social Security card, keep them in a safe place, like a locked file cabinet.

    When you decide to get rid of those documents, shred them before you throw them away. If you dont have a shredder, look for a local shred day.

    Also Check: Do You Pay Taxes On Roth Ira Withdrawals

    What It Means To Have A Qualifying Child

    The IRS says you can claim children as dependents as long as they meet the following requirements:

    • The child must be related to you. For example, your son or daughter, stepson or stepdaughter, brother or sister, stepbrother or stepsister, nephew or niece, or grandchild can be considered a dependent.
    • In most cases, the child youre trying to claim must live with you for more than six months out of the year. But there are exceptions for children who are away from home because theyre sick, attending college, serving in the military, starting a business or taking a vacation.
    • The child youre trying to claim has to meet an age test as well. Children can only be claimed as dependents if they are under the age of 19. However, you can claim full-time students as dependents until they turn 24.
    • Children who are permanently or completely disabled can be claimed as dependents for their entire lives if they meet the other criteria for qualifying children.

    Are My Tax Credits Or Benefits Linked To My Partners Income

    All Six Rules for Claiming A Child Dependent on your Tax Return – Dependency Exemption 2017

    Its important to remember that when you get married or enter into a common-law relationship it could mean that the benefit amounts youre used to receiving will change. The CRA and Revenu Québec will take into account the total earnings from both spouses to determine which credits and benefits you may be eligible for and who they should be allocated to. For example, if you have childcare expenses, they can only be claimed by the spouse or common-law partner with the lower net income. A change in your marital status can also impact both your Canada Child Benefit and your GST/HST payment amounts.

    On the bright side, as a spouse or common-law partner, you might be eligible for a number of credits or benefits that could increase your refund, including:

    Recommended Reading: Is Nursing Home Care Tax Deductible

    View Child And Dependent Related Deductions

    You can choose between the 2 following deductions:

  • Child care expenses deduction:
  • For children under age 13
  • Disabled dependent or spouse
  • Dependent member of household deduction:
  • For children under age 12
  • Dependents age 65 or older
  • Disabled dependents
  • If you qualify for both, you’re only allowed the greater of the 2 deductions. You cannot claim both deductions.

    A “disabled dependent” is defined as an individual who is permanently and totally disabled. This means that the person is unable to engage in any substantial gainful activity due to a medically determinable physical or mental impairment that can be expected to result in death, or to last for a continuous period of no less than 12 months.

    Letting Your Parents Claim You As A Dependent Child On Their Tax Return

    Once your parents claim you as a dependent on their tax return, your parents will also claim all scholarships, grants, tuition payments, and your 1098-T on their tax return.

    In addition, your parents will also be able to claim all eligible educational tax credits.

    What You Must Do If Your Parents Can Claim You As a Dependent:

    If you earned income, but your parents still qualify to claim you as a dependent, all you have to do is select the option for I can be claimed on someone elses return.

    Tax Advantages for Parents Claiming You on Their Tax Return

    Parents will qualify for educational credits that students potentially cannot get on their own. If your parents meet the requirements to claim you, let them! If your parents meet the requirements, but choose not to claim you, then you still have to select the option for I can be claimed on someone elses return when you file your tax return.

    Your parents may also be eligible for the child tax credit and the earned-income tax credit, which can result in a sizable refund or substantial tax savings.

    Don’t Miss: When Is Sales Tax Due

    What Parents Need To Know

    When it comes to helping your child file their income taxes, you should know the following:

    • Legally, your child bears primary responsibility for filing and signing their own income tax returns. This responsibility can begin at any age, perhaps well before your child becomes eligible to vote.
    • According to IRS Publication 929, “If a child can’t file his or her own return for any reason, such as age, the child’s parent, guardian, or another legally responsible person must file it for the child.”
    • Your child can receive tax deficiency notices and even be audited. If this happens, you should immediately notify the IRS that the action concerns a child.
    • According to IRS Publication 929, “The IRS will try to resolve the matter with the parent or guardian of the child consistent with their authority.”

    More articles

    Popular Articles