Unusual Dependency Question

[KBTS]

I have an unusual situation involving a dependency exemption to throw out to the board. Here is the situation:

Child's parents were married, but husband (not the child's biological father) was in jail until October of 2009. Child was living with mom, until mom died in September. After mom's death, child moved in with biological grandmother and court awarded grandma custody. Child is still living with grandma at this time.

Since child lived with mom for more than half the year, it seems to me that the stepfather could claim the child if he files a MFJ return with the deceased mom. Grandma has inquired about the exemption, but child only lived with her for four months (Sept- Dec) so I do not think she qualifies. To top things off, the husband and the grandma are not on the best of terms so if there is the option for them to decide who gets to claim the child, it may not go so well.

Any ideas are appreciated.

[Koss]

Question

In your post, you state that the husband of the deceased mother is not the child's biological father. But then you say that it seems that the father could claim the exemption if he files MFJ...

Is that just a typo? Are we talking about the same guy? Is one person:

- in jail until October
- husband of the deceased mother of the child, and
- stepfather of the child?

Or are there two guys in this picture?

BMK

[thomtax]

I think the first thing that I would have to determine is whether the husband (not father) is even allowed to claim the child. The only way that would seem to me to qualify is if it is stepchild. If the mother died and he is no longer married to her, did the status of stepchild not stop with her death?

I'm sure the answer is in ther somewhere, but did not spot it when going through Pub 17.

Hope this helps a little.

LT

[Possi]

Stepchild = Child

I do not believe death changes the relationship between step-father and child. The step-child is considered his child for tax purposes.

I would file MFJ claiming the child. As long as the child lived with him for more than half the year, until he went up the river for a month, he is the only one who wins the prize.

Anyone else weighing in?

[Koss]

Comments

I agree that the relationship of stepfather is not terminated by the death of the mother.

Thus, as noted in the original post, the stepfather can probably claim the child as a qualifying child if he files MFJ with his deceased wife.

Observation No. 1:

The fact that the child lived with Grandma for less than half the year appears to disqualify her from claiming the child as a qualifying child. But she might be able to claim the child as a qualifying relative. A grandchild is one of those "relatives who do not have to live with you." For this to be applicable, Grandma would have to assert that she provided more than half the child's support during the year. While this may be unlikely, it is not impossible.

Observation No. 2:

If both try to claim the child, and the child is in fact the qualifying child of the stepfather, then the stepfather's claim will trump Grandma's claim because she is not the parent, and he is. On a joint return with the deceased mother, the stepfather does in fact have the same rights as a biological parent.

Observation No. 3:

I am not certain that the stepfather has an automatic, inalienable right to file MFJ with his deceased spouse. There is something of a presumption that he may choose to do so.

But who is the executor of the mother's estate? The executor or personal representative may have a higher right than the surviving spouse to choose the filing status on the final return of the decedent...

Maybe there was no will and there is no estate.

How dirty does Grandma want to play? She might be able to go into probate court and get herself appointed as the administrator of the estate. And that might preclude the stepfather from signing an MFJ return on behalf of his deceased wife.

Grandma should probably talk to a lawyer before trying to pull a stunt like that.

Who is your client, anyway? The stepfather or the Grandma?

BMK

[erchess]

Executor / Personal Representative

Depending on State Law either the Executor or the Personal Representative has the final say in whether the late wife consents to file jointly.

It strikes me as MLTN that if there is a court fight over this between the mother and husband of the deceased the husband would win.

[KBTS]

Koss - I edited the original post to clarify that there is just the husband/stepfather involved. The grandma is my client and I am unsure exactly who is the executor. I am fairly certain there was no will, so the court may have appointed an executor. I'm not sure my client wants to go through all the possible trouble over the exemption - she already lost her daughter and things are a bit rocky with the grandchild right now too.

[taxmom34]

not sure if i'm reading this right, but i get the impression that the stepfather was in jail until october? or was it just the month of october. what happened to the biological father , not in picture at all? was he paying child support, he may want to claim the child if he did.(i know child support is not supposed to be a factor, but he may think so)

[taxea]

Did the alleged father provide the required support to this child? Did the child live in the prison cell with the father?
Don't read into the law what isn't there. Use the chart in TTB.
My take is the deceased mom would be the only one that actually qualified to take the child. Her death is unfortunate but unless the grandparents provide more than half of the support during the time mom was alive, along with other reasons, I don't think they qualify.

[thomtax]

I do not believe death changes the relationship between step-father and child. The step-child is considered his child for tax purposes.

Possi,

I have been looking and cannot find it. Can you give me a cite that will show that a person is still classified as a step parent (in a tax sense, if there is any sense to taxes) when the real parent is deceased and the step parent no longer has any type of relation to the child. I'm not saying you are wrong, I'm just having a problem with this concept of the situation continuing. I know in real life this probably happens quite often, but just trying to fit it with tax law.

I realize that in this example, since he could still file with deceased ex-wife, it is different, but I'm speaking of most situations.

Thanks,
LT

[Larmil]

Possi,

I have been looking and cannot find it. Can you give me a cite that will show that a person is still classified as a step parent (in a tax sense, if there is any sense to taxes) when the real parent is deceased and the step parent no longer has any type of relation to the child. I'm not saying you are wrong, I'm just having a problem with this concept of the situation continuing. I know in real life this probably happens quite often, but just trying to fit it with tax law.

I realize that in this example, since he could still file with deceased ex-wife, it is different, but I'm speaking of most situations.

Thanks,
LT

See IRC §1.152-2(d).