We explain the five phases of retirement planning, the difference between a k and an IRA, types of investments, asset diversification, the required minimum distribution rules, and more. Find out how to choose a nursing home or assisted living facility, when to fight a discharge, the rights of nursing home residents, all about reverse mortgages, and more.
Get a solid grounding in Social Security, including who is eligible, how to apply, spousal benefits, the taxation of benefits, how work affects payments, and SSDI and SSI.
Learn how a special needs trust can preserve assets for a person with disabilities without jeopardizing Medicaid and SSI, and how to plan for when caregivers are gone.
Find local attorneys. Claiming a Parent As a Dependent March 6th, There are five tests to determine whether you can claim a parent as a dependent: The person you are claiming as a dependent must be related to you. This shouldn't be a problem if you are claiming a parent in-laws and stepparents are also allowed. Keep in mind, however, that foster parents do not count as a relative.
To claim a foster parent, he or she must live with you for a year as a member of your household. Your parent must be a citizen or resident of the United States or a resident of Canada or Mexico. Your parent must not file a joint return. If your parent is married, he or she must file separately. There is an exception if your parent is filing jointly, but has no tax liability. If your parent files a joint tax return solely to get a refund, you can claim him or her as a dependent. Gross income does not include Social Security payments or other tax-exempt income.
You must provide more than half of the support for your parent during the year. Whether it's driving to doctor appointments, paying for nursing home care or medical expenses, or handling their personal finances, dealing with an elderly parent or relative can be emotionally and financially draining, especially when you are taking care of your own family as well. Fortunately, there is some good news: You may be able to claim your elderly relative as a dependent come tax time, as long as you meet certain criteria.
Here's what you should know about claiming an elderly parent or relative as a dependent:. The IRS defines a dependent as a qualifying child or relative. A qualifying relative can be your mother, father, grandparent, stepmother, stepfather, mother-in-law, or father-in-law, for example, and can be any age.
There are four tests that must be met in order for a person to be your qualifying relative: not a qualifying child test, member of household or relationship test, gross income test, and support test. He or she must be U. If your qualifying parent or relative does live with you, however, you may be able to deduct a percentage of your mortgage, utilities, and other expenses when you figure out the amount of money you contribute to his or her support.
In addition, your parent or relative, if married, cannot file a joint tax return with his or her spouse unless that joint return is filed only to claim a refund of withheld income tax or estimated tax paid.
You must provide more than half of a parent's total support for the year such as costs for food, housing, medical care, transportation and other necessities. Those expenses can include doctor visits, medications, equipment, transportation, hospital stays, insurance premiums and more.
However, to deduct these expenses, the total amount must exceed 10 percent of your adjusted gross income to claim them.
Dependent care credit. If your parent is unable to care for themselves independently, you may qualify for a dependent care credit. You can get a credit for expenses associated with their daily care, if those expenses allow you or your spouse to continue working or look for work.
To receive a tax benefit on your or return, you must itemize deductions. The annual combined medical expenses paid for you, your dependents, and your parent must exceed 7. The adult-dependent exemption is just one tax break that you may be able to employ to ease the financial burden of caring for a parent, elderly or otherwise. Contact our office in Lake Forest to learn more.
0コメント