Minor child's ss

[thomtax]

Just received a package in the mail for a new client that will be moving here. I had him include last year's return.

The client has a son that started receiving ss payments during 2008 and payment is under sons ss#. The parent provided more than 1/2 of support for child. On the 2008 return, the previous preparer has included this amount on line 21 listed as "SON SOCIAL SECURITY" and has shown it all as taxable. I have never handled it this way and unfortunately, at this late date, do not have time to research. I have put it on extension.However, when I see something handled differently, can't help wondering if I have been wrong all this time.

As usual, thanks for your thoughts.


LT

[David1980]

It would go on the son's return, the son probably does not have any filing requirement so it just doesn't go anywhere.

(If son did have to file a return for interest or something that's where it would go.)

[RitaB]

David is right

Amend parent's 2008, and you are their new best friend, too.

[thomtax]

Thanks

This is the way that I had always considered it, but right now am sleepy and fuzzy thinking. So when I saw that, I began questioning myself.

Again, thanks for your thoughts.

LT

[Burke]

At least you don't have to scramble to try and catch 2006 by tomorrow. Have one coming in in a.m. with info to determine if that is the case (not SS -- another problem.)

[thomtax]

Reviving this thread for new question

As I went to complete this amended return, I ran into an unusual situation.

1 - If I amend the return and remove the child's ss payments, but use the original figures on this, when all the changes in the credits, RRC, etc. are taken into account, there is very little in the increase in refund - actually not enough to bother filing the amended.

However, if the standard deduction if used instead of the original itemized deductions, it will mean about $200 in additional refund.

2 - Now my question. I have looked in TTB and on IRS site at publications for amended returns. I cannot find any reference to it - SO - does anyone know if there is a prohibition against changing from itemized to standard deduction?

Thanks.
LT

[veritas]

The child

Just received a package in the mail for a new client that will be moving here. I had him include last year's return.

The client has a son that started receiving ss payments during 2008 and payment is under sons ss#. The parent provided more than 1/2 of support for child. On the 2008 return, the previous preparer has included this amount on line 21 listed as "SON SOCIAL SECURITY" and has shown it all as taxable. I have never handled it this way and unfortunately, at this late date, do not have time to research. I have put it on extension.However, when I see something handled differently, can't help wondering if I have been wrong all this time.

As usual, thanks for your thoughts.


LT

may not be a dependent of the parents under the support test.

[thomtax]

may not be a dependent of the parents under the support test.

No problem there. I guess that I should have posted under a different theme to make clear what my question was.

Thanks,
LT

[Burke]

2 - Now my question. I have looked in TTB and on IRS site at publications for amended returns. I cannot find any reference to it - SO - does anyone know if there is a prohibition against changing from itemized to standard deduction?
Thanks.LT

No such rule. You can change it.

[veritas]

Your post was clear

No problem there. I guess that I should have posted under a different theme to make clear what my question was.

Thanks,
LT

It was merely an observation on my part. My experience generally has been that children receiving Social Security benefits provide more than half of their own support.

[FEDUKE404]

Exemption question

It was merely an observation on my part. My experience generally has been that children receiving Social Security benefits provide more than half of their own support.

I tend to agree with the possible loss of the dependency exemption.

Over the years I've had several clients whose child(ren) were receiving Soc Sec survivor benefits....which can easily exceed $1k/month.... and they could not claim the child as a dependent. In most cases, the head of household filing status was available to provide some assistance.

Remember also that the parent/guardian at some point will have to fill out a detailed form for the SSA which shows how the funds received for the child were actually spent for the benefit of the child (clothing/education/medical/etc) during a given calendar year. That can provide some additional background information.

As for the original post - I cannot believe anyone presenting themself as a tax professional would ever show the child's Soc Sec benefits as income on the parents' tax return!

FE

[Lion]

Dependency

Not one of my minor SS recipients has ever been even close to providing more than half their own support. Daycare alone is well over $1,000/month for the single mom with the child whose father passed away. Tuition is 2-3 times that for the older couple where dad's on SS, so minor son is also. Summer camp is $10,000 for another working couple. And, on and on. I don't have to add very many support items before the parents' contribution is well over the child's own contribution to his support, even if the child does not save any of his SS for college, car, whatever, in the future. I do add up the columns on the worksheet, but as I say I don't have to dig very deep for amounts the parents spend before I have my answer.

[FEDUKE404]

Kamp Med ?

....Summer camp is $10,000 for another working couple...

WOW!! Can't say as I ever had anyone to spend $10k on a kid's summer camp.

Most of the people I deal with would have a hard time coming up with that kind of up-front money for a year of college.

FE

[Burke]

As for the original post - I cannot believe anyone presenting themself as a tax professional would ever show the child's Soc Sec benefits as income on the parents' tax return! FE

Not only that, but to include it on Line 21? What was he thinking? I have run across the occasional error where it was included on the SS line and used in the computation of taxable SS.

[Lion]

Pa

That's the summer camp my son used to work at in PA out in a depressed area between a couple of mountain ranges. So, I imagine the fancy sports camps and Broadway musical camps and computer camps that my CT neighbors send their kids to on the campuses of Ivy League schools or in beach resorts with big name sponsors/coaches/opening speakers are even pricier. (To be fair, the cost came in just a tad under $10,000 but a minimum $250 "camp store" account was required bringing the minimum up to $10,000 for the summer. Also, they did give sibling discounts.)