My client's grandson lives with them. On audit they could not come up with satisfactory proof of residency. Got tired of the battle and paid the additional tax due (without consulting with me). Is there now any hope of reversing this situation? I am more concerned about future years as the child does indeed live with them. The school does not want to be involved because the mother is somewhat volatile. The neighbors and the school bus driver will confirm that the boy does live with them. EIC is not involved.
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School records should show the residence address and who the responsible party/contact info is
Doctors records should show the residence address and the responsbile party for Insurance, etc
What about Church or social activities?
Who covers the Granchild for Health Insurance?
Maybe the Grandparents need to talk to a Social Worker, so they become either Foster Parents, and/or Legal Gurardian or adopt the Grandchild ( I have had 3 of these)
Sandy -
They have been reluctant
to involve the county but I think it is a good idea. The mom has insisted that all school and medical records remain in her name. She supplies the insurance. I will suggest they try to become foster parents. What a great idea. Thank you, Sandy.Comment
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I had the same exact situation years ago and they, too, gave up fighting it, even though they provided the IRS with all that proof. The problem was, the no-good daughter ran down to HRB and filed early, claiming the children (after all, they are hers, right?) and all the resultant goodies, like EIC. The end result of the whole affair, was that she eventually came and took them away from the grandparents. So its a risk.Comment
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Sandy maybe the social worker could give them foster care status but the other two require the mother's cooperationOriginally posted by S T View PostBelieve nothing you have not personally researched and verified.Comment
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The grandparents can still submit their return manually with the child and all the documentation that the child lives with them. IRS may require a signed 8832. The real question is do they provide more than 1/2 of the support if the mother provides all that she does. If so I would fight it through the IRS.Originally posted by Burke View PostBelieve nothing you have not personally researched and verified.Comment
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The mother provided no support, the grandparents 100%. Back then, it was a paper return. Form 8832 didn't exist. Unfortunately, statute of limitations ran out long ago.Comment
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Form 8332
The grandparents may well be entitled to claim the children in question as dependents. But Form 8332 will not resolve the issue, and may well cause unnecessary confusion.Originally posted by taxea View Post
We have talked about this before. Pursuant to the instructions for the form, Form 8832 is used for one specific purpose only. It allows the custodial parent to release the exemption to the noncustodial parent. The form is then filed with the tax return of the noncustodial parent, who claims the child as a dependent.
And as we all know, the custodial parent is "the parent with whom the child lived the greater number of nights during the year."
In the fact pattern described here, the children actually live with the grandparents.
As a preliminary matter, the grandparents are not parents. The relationship test is certainly met. But these terms are not synonymous. The "Rules for Children of Divorced and Separated Parents" do not necessarily apply to grandparents.
But even if I assume, for the sake of argument, that those rules are somehow applicable, Form 8332 still cannot be used here.
The children live with the grandparents. Therefore, neither grandparent is the noncustodial parent.
Form 8332 will not magically resolve an IRS challenge to a dependent exemption. The form is not a mechanism by which a dependent exemption can be transferred from one person to another, as if it were a piece of property. The form has a very limited scope, and it simply is not applicable in this scenario.
Using the form in this case actually undermines the grandparents' claim that the children live with them, because it characterizes the grandparents as noncustodial parents. (Which, in my view, is absurd, because you can't be a noncustodial parent or a custodial parent if you are not even a parent.) It would also preclude them from claiming EIC. Even worse, the use of the form would actually imply that the children live with their mother, because she would be identified as the custodial parent on the form.
BMKLast edited by Koss; 03-29-2014, 11:30 PM.Burton M. Koss
koss@usakoss.net
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The map is not the territory...
and the instruction book is not the process.Comment
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poster "The mom has insisted that all school and medical records remain in her name. She supplies the insurance" and I would bet all at her address.
I know an 8832 won't solve the problem but for all intent and purpose the grandparents are acting as "the other parent".
Anyhow, I maintain that filing with the child as a dependent on a manual return with as much documentation as possible will cause the IRS to go after the mother for filing a false return. I have done this many times and the IRS has designated the child to the custodial "caretaker" along with their proper refund. It may take time but it works.Believe nothing you have not personally researched and verified.Comment
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I guess you don't read other posters when you reply more than once. posters have corrected you on form 8332 twice and you still insist on using 8832!Originally posted by taxea View PostComment
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that isn't really the issue on the post....please forgive my fingers for errant walkingBelieve nothing you have not personally researched and verified.Comment
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