Irs F14037

[erchess]

Many of you know that this form is to be filed by taxpayers who are or may become victims of identity theft with tax consequences. But what do you do if the stolen identity belongs to a dependent who is too young to answer questions for herself let alone sign tax filings?

Here's the scenario - a grandfather supported his daughter and her child and claimed the grand daughter as a dependent and EIC and HH with her mother's blessing. I am told that no one else provided any support for the child. Someone else claimed the child as a dependent and so far the IRS is agreeing with them. I think this is because the grandfather did not have assistance in preparing what was sent to the IRS. I have reopened the audit and asked for but not yet received copies of everything. And now the grandfather has received a second notice of his need to pay back funds in this matter.....

Any advice would be welcomed and whatever I decide to do will be my responsibility.

[Burke]

IMO, I would think the form should be signed by the custodial parent, or legally appointed guardian for the child if any. It would be the same person who would sign the tax return on child's behalf if one were required. In this case, it seems it would be the mother?

[JohnH]

Frequently, a call to the IRS collections division can be the easiest way to get them to temporarily suspend collection on an account. Unless the client has let it go past a reasonable point, it's fairly easy to get 30-45 days, with an understanding you'll call back BEFORE the period is up if you need more time.

I prefer doing this with the client conferenced in on the call, so the IRS rep can be assured that the client knows what's going on. Makes it easier for them to agree to grant the extra time. Plus, you don't have to mess around with those pesky POA's making it look like the client is just using you to throw up roadblocks.

[taxea]

Many of you know that this form is to be filed by taxpayers who are or may become victims of identity theft with tax consequences. But what do you do if the stolen identity belongs to a dependent who is too young to answer questions for herself let alone sign tax filings?

Here's the scenario - a grandfather supported his daughter and her child and claimed the grand daughter as a dependent and EIC and HH with her mother's blessing. I am told that no one else provided any support for the child. Someone else claimed the child as a dependent and so far the IRS is agreeing with them. I think this is because the grandfather did not have assistance in preparing what was sent to the IRS. I have reopened the audit and asked for but not yet received copies of everything. And now the grandfather has received a second notice of his need to pay back funds in this matter.....

Any advice would be welcomed and whatever I decide to do will be my responsibility.

Here is how I do it and I have yet to have the deduction denied. It may take time

1. get as much information as you can from the grandfather and mother of the child as to who they may suspect took the child. Get as all identifying information on the person/s your end can provide; determine the relationship between the person/s and the child; why they think this person/s may have taken the child.

2. file a manual return for the grandfather including the child as his dependent with a 8332 from the mother.

3. include a detailed statement with the information you obtained and ask the IRS to further investigate the offending party’s return in relation to the claim of the child.

I have found that this is usually not an identity theft by a total stranger but usually by someone who knows the child and perhaps was of the opinion that if the mother didn’t have to file a return the child was free to be claimed on their return.

The IRS will not tell you who took the claim but will investigate the person that filed the return to determine whether they qualified to take the child.

My clients haven’t ever gotten a denial of the claim. I can only presume that the other person was required to repay the refund on behalf of the claim.

[MilTaxEA]

Do not use an 8332! That is for the custodial parent to release the exemption and CTC to the noncustodial parent. The grandfather can claim the child as his qualifying child and is entitled to not only the CTC/exemption, but HOH, daycare expenses, and EITC. He just needs to produce school or medical records (maybe with a written witness statement or two) showing the child lived with him more than half the year.