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Arguing over tax refund . Who should get the money ?

Author :

Submitted : 2018-06-15 06:35:49    Popularity:     

Tags: tax  Arguing  money  refund  

So my sister allowed me and my son to live with her while I finish my degree. I have helped her in the past so I guess she's returning the favor. Anyhow, she pays the rent while I pay for food and utilities. Since I'm not working (living off sav

Answers:

if your son lives in her house 6 months and at least 50% of his support is not provided(by you or other means) she can claim him and this will adjust her taxable income by $4050, the amount of money this will change of her refund will depend on which bracket she falls in, if she is in the 10% bracket then the refund would be $405 more
as so who the money belongs to if she qualifies to claim him it is hers
to determine the amount of his support, if there are three of you the rent, utilities, phone, cable, maintenance, insurance, medical, clothes ect is divided by three, if you pay for food and utillities it will have to amount to his third

The taxpayer to whom the refund is due is entitled to it. If that person want to share, that is their business.

Your sister. It's as simple as that. She is footing more than half of his support and yours (that includes not only the rent but utilities and groceries). It's the least you could do in repayment of all she's been doing for you and your child.

Legally, the person who claims a child they have legal right to claim is entitled to the entire refund. How and if it gets split depends on what the parties agree to.

It's her refund from her own income. You didn't earn any money or pay any tax. Why should you receive any of HER money in addition to living with her rent-free?

The rule is that if neither parent claims a child - which you didn't if you didn't have any income - then another relative with whom the child lived at least half the year can claim him.

In fact, while the rules are more restrictive for adults, it sounds like she could have claimed YOU as a dependent as well.

Here's the rule:
Whoever ended up paying the MOST for the child care should get most of the money, IF there is any. By the way, who pays the electricity and cable TV and cell phone and internet bills? Your son uses electricity and cable TV and cell phone and internet, too. Its HER house, so if your sister pays those bills too, then YOU owe her money for THAT, too.

Work it out privately, and one of you pays back the other with cash or a check. DO NOT get the IRS involved!!!

I assume that YOU have declared your son in teh past years of his life. To declare a child you MUST have their Social Security Number on the tax form. In the IRS computers, HIS SSN number is now associated with YOUR SSN number, as a family.

But if SHE declares him on her tax form, all the Little Red Flags are gonna pop- out of the IRS computer. WHY is this child now listed on someone elses tax form?? Where is the legal paperwork showing that YOU agreed to this? Was there an adoption? Where is the Change of Address form? PROVE TO US THAT HE HAS A NEW MOTHER!!!

You DO NOT want to fight this! At best, neither you nor your sister will see you refunds until Christmas. and at worthy you will be "flagged" as a potential case of fraud, and spend two years fighting the IRS.

AS you pointed out, declaring a child does NOT guarantee a refund. The child is traeted as an EXEMPTION, which only lowers your amount of taxes. It MAY end up that you both have a smaller bill to pay to the IRS, but NO REFUND.

So here is what you do. YOU total up how much money it take to take care of a growing boy -- ALL food, ALL transportation, ALL electricity, ALL cell telephone, and so on. Your sister figures up all that she pay that he uses. Like, if the rent is $1200 a month then $400 is for HER, $400 is for YOU, and $400 is for HIM. She needs to inc.lude the electricity bill, the cable TV bill, the cell phone bill, and so on.

So, lets say that it costs $1200 a month to pay for HIM alone. That is rent, electricity,EVERYTHING. Now, she say it costs her $500 a month to pay for HIM. $500 / $1200 = 42%. YOU pay $700 a month for HIM, and that is 58%.

Now, IF there is a refund, then SHE get $42% of it, and YOU get 58% of it.

Since YOU pay the bigger percentage for him (585), YOU declare him on YOUR return, and write her a check when the refund comes in.

First of all, just because someone "offers" to claim your child doesn't mean they meet the IRS criteria to do so. Your child must have lived with her all year and she must have provided more than 1/2 his support. That said, if she is providing more than 1/2 your support, you lived with her all year, and made less than $4050 she could claim you too. If you're not paying her anything to live there, you should let her have the full refund. If she is not entitled to claim your son, she should amend the return and pay back the money to the IRS and state.

Sorry, but she is supporthing your son... you have no income & he lives with her.

If your sister has the legal right to claim the child, she can claim the child and would get 100% of the tax refund associated with it (if any).

If your sister does not have the legal right to claim the child, she can't claim him. It does not matter if you gave her permission, she legally can't claim the child.
- If she can't claim the child, then no one can claim the child (except potentially the father), since you have no income.

You have no income. She made income, she filed taxes, and allowing you and your son to live with her has been generous on her part. Remember, IT IS HER MONEY. It's income that she earned, she would have paid it in taxes, but claiming your son as a dependent has reduced her taxable income and allowed her to get a bigger refund. All you are doing is helping her to get back more of her OWN money, instead of paying it to the government. You would have never seen that money either way, and allowing her to claim your son as a dependent on this year's taxes shouldn't entitle you to receive any part of the tax refund.

I think you should allow her to keep 100% of the tax refund money and be glad that you can do something to repay her that doesn't cost you a thing. Maybe she'll pay for dinner out for the 3 of you when she gets the refund check, but by no means should you feel entitled to that.



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